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Currency hedged ETF and ETP assets reach record USD195bn at the end of July


Assets invested in currency hedged ETFs and ETPs listed globally reached a record USD195 billion at the end of July. 

Currency hedged ETFs and ETPs listed globally reported net inflows of USD7.57 billion at the end of July bringing year to date net inflows to USD17.04 billion which is significantly more than the USD12.61 billion gathered at this point in 2019, according to ETFGI’s July 2020 Currency hedged ETFs and ETPs industry landscape insights report, a monthly report which is part of an annual paid-for research subscription service. 

“The S&P 500 gained 5.6 per cent in July, aided by the US Federal Reserve stimulus and strong earnings,” says Deborah Fuhr, managing partner, founder and owner of ETFGI. “International markets also gained, with Developed Ex-US and Emerging up 3.0 per cent and 8.5 per cent, respectively. In the developed markets Scandinavian countries benefited most, led by Norway (up 10.8 per cent) and Sweden (up 10.1 per cent); while Japan (down 2.0 per cent) was the sole negative performer among developed countries. Dollar weakness contributed toward the positive momentum in Emerging markets where 19 of 25 countries gained, led by Brazil (up 14.4 per cent) and Pakistan (up 13.4 per cent), while Taiwan (up 12.1 per cent) neared an all-time high.” 

At the end of July 2020, there were 811 currency hedged ETFs/ETPs, with 1,781 listings, there were currency hedged ETFs/ETPs hedged against 15 different currencies, assets of USD195 billion, from 77 providers listed on 30 exchanges in 23 countries.

Year to date, 34 new currency hedged ETFs/ETPs were launched by 28 providers across 15 index providers in 14 countries, while 17 products were closed from nine different providers.

During the month, currency hedged ETFs/ETPs providing exposure to the United States gathered the largest net inflows with USD2.49 billion, followed by mixed exposures with USD1.93 billion and European – Developed exposures with USD1.32 billion, while Asia Pacific – Developed exposures experienced the largest net outflows with USD62 million. On a year to date basis, currency hedged ETFs/ETPs providing exposure to the United States exposures gathered the largest net inflows with USD9.44 billion, followed by Mixed exposures with USD6.5 billion and Other exposures with USD2.33 billion, while Asia Pacific – Developed exposures experienced the largest net outflows with USD2.40 billion.

The top 10 currency hedged ETFs/ETPs by net new assets collectively gathered USD5.36 billion at the end of July.

The Vanguard Total International Bond ETF (BNDX US) gathered USD1.59 million, the largest net inflow for the month. 

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