BlackRock has expanded its currency-hedged exchange traded fund (ETF) range with the launch of the iShares MSCI Europe ex-UK GBP Hedged Ucits ETF and the iShares JPX-NIKKEI 400 EUR Hedged Ucits ETF, providing investors with hedged exposure to European and Japanese equity markets respectively.
The iShares MSCI Europe ex-UK GBP Hedged Ucits ETF provides access to large and mid-cap companies from 14 developed European markets outside the UK. It is designed for sterling investors looking to gain exposure to the region.
The iShares JPX-NIKKEI 400 EUR Hedged Ucits ETF tracks an index of Japanese companies with attractive fundamentals. The fund’s underlying index screens for highly liquid companies with strong return-on-equity and robust corporate governance practices.
The iShares JPX-NIKKEI 400 EUR Hedged Ucits ETF and iShares MSCI Europe ex-UK GBP Hedged Ucits ETF have a total expense ratio of 0.45% and 0.40% respectively. Both funds are physically replicating, meaning they buy the underlying stocks in the index.
Tom Fekete, head of Product for iShares in EMEA, commented: “The total return that European and UK investors receive on non-European or non-UK securities depends on both asset returns and currency movements. ETFs that employ built-in currency hedging can help mitigate fluctuations in exchange rates in one simple, liquid and transparent trade and thereby avoid the need to hold and maintain separate hedging programmes.
“We continue to see positive data out of Europe, helped by QE, while Japan remains one of the best performing markets year-to-date, supported by recent corporate reform. The newly launched products complement our suite of ETFs that investors can use to access positive market sentiment or to express longer term views, while minimising currency risk.”