04.10.2010 - Making sense of currency effects
From WSJ: Foreign-currency exposure has put many international-stock funds on a roller coaster this year. Those gyrations serve as a vivid reminder to investors that buying an international fund isn't just a bet on the companies the fund holds, but on the local currencies as well, unless the fund hedges its currency exposure back into U.S. dollars. In the first half of the year, the euro fell about 15% against the dollar, thanks to the European debt crisis. That contributed to the average 14.6% drop in Europe-focused funds and average 11.7% drop in broad international-stock funds, as tracked by Lipper Inc...........................................Full Article: Source
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