VanEck launches new international AUD hedged ETFs
Listing Thursday 9 November on ASX, the new funds are:
- VanEck MSCI International Small Companies Quality (AUD Hedged) ETF – ASX: QHSM
- VanEck MSCI International Value (AUD Hedged) ETF – ASX: HVLU
- VanEck Morningstar Wide Moat (AUD Hedged) ETF – ASX: MHOT
QSHM is a currency hedged version of the VanEck MSCI International Small Companies Quality ETF (QSML). HLVU is a currency hedged version of the VanEck MSCI International Value ETF (VLUE). MHOT is a currency hedged version of the VanEck Morningstar Wide Moat ETF (MOAT).
Arian Neiron, VanEck CEO and Managing Director, Asia Pacific said: “We’re seeing an increasing number of investors seeking out international exposures and growing the international allocation within portfolios. As more money flows offshore, the currency hedging decision, which can depend on an investor’s risk profile and movement of the Australian dollar, is becoming increasingly important.”
The decision to hedge currency exposure is important as a local currency appreciation can eat into returns from an international investment while a depreciation can enhance returns.
“These new funds will provide investors with the opportunity to target return outcomes by managing their Australian dollar exposure with proven smart beta international equity strategies. 2022 and 2023 have both demonstrated to investors that being selective across the investment universe by employing systematic approaches has many advantages including, but not limited to, targeting return outcomes, avoiding ‘junk’, improving transparency and cost effectiveness.
“In light of US equity valuations, particularly the S&P 500, investors are looking for hyper-selective strategies that considers fundamentals and improved risk-adjusted returns over the long term.
“In an environment of heightened uncertainty and with central banks looking close to reaching peak rates, both QSML and MOAT have outperformed their respective benchmarks over the last 12 months,” said Neiron.
QSML outperformed the MSCI World ex Australia Small Cap Index by 8.92% and MOAT outperformed the S&P 500 by 4.45%, over 12 months to 31 October 2023. As always, past performance is not indicative of future performance.