Top ETFs to Capitalize on a Strong U.S. Dollar
Following Donald Trump's election victory, the U.S. dollar has surged to a one-year high against a basket of currencies. Trump's policies on economic growth, inflation, and fiscal deficits have reduced the likelihood of Federal Reserve rate cuts, further supporting the dollar. This strong dollar is attracting global investors and benefiting the U.S. economy, particularly in areas like energy costs and industrial growth. Here are some ETFs that stand to benefit from the rising dollar.
Invesco DB US Dollar Index Bullish Fund (UUP)
UUP directly benefits from a rising dollar by tracking the U.S. Dollar Index, which includes six major currencies. It invests heavily in euros (57.6%) and the Japanese yen and British pound (25.5%).
Assets under Management: $304.3 million
Expense Ratio: 0.78%
YTD Performance: 11%
UUP is ideal for those looking to profit from the dollar's rise.
iShares Russell 2000 ETF (IWM)
Small-cap stocks, which have limited international exposure, perform well in a strong dollar environment. IWM tracks the Russell 2000 Index, covering 1,972 small-cap stocks that benefit from domestic growth.
Assets under Management: $78.9 billion
Expense Ratio: 0.19%
YTD Performance: 16%
IWM is a solid choice for investors focused on U.S. domestic growth.
iShares Currency Hedged MSCI EAFE ETF (HEFA)
HEFA hedges currency risk while offering exposure to developed markets in Europe, Australasia, and the Far East. It tracks the MSCI EAFE 100% Hedged to USD Index, making it ideal for those seeking international exposure without currency fluctuations.
Assets under Management: $5.4 billion
Expense Ratio: 0.35%
YTD Performance: 11%
HEFA is perfect for investors wanting to avoid currency risks in developed markets.
Conclusion
A strong dollar creates opportunities in U.S.-focused ETFs like UUP, IWM, and HEFA. These ETFs offer ways to capitalize on dollar strength while aligning with different investment goals.
$标普500ETF(SPY)$ $美元ETF-PowerShares DB(UUP)$ $罗素2000指数ETF(IWM)$ $iShares Currency Hedged MSCI EAFE ETF(HEFA)$
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