Five Surprising Insights About Stock Indexes and Funds
Money For the Rest of Us
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The Impact of Currency on Returns of Indexes
A third insight is that currency has a much larger impact on returns of indexes, index mutual funds, and ETFs than I realized. If the US dollar strengthens relative to the rest of the world, a US-based investor investing overseas will have a lower return when the currency strengthens. In June 2020, we added the wisdom tree, Japan's small cap dividendETF, DFJ2,. We should have invested on a hedged basis.
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