Podcasts & Videos

Capitalize on European Central Bank Changes with Currency-Hedging

March 12, 2015
There has always been a strong case for European equities. But what about the euro risk? Learn how hedging the euro could help reduce volatility in our podcast.

Recorded February 19, 2015.

Past performance is not indicative of future results. You cannot invest directly in an index.

Hedge: Making an investment to reduce the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting position in a related security, such as a futures contract.

Monetary easing: Actions undertaken by a central bank with the ultimate desired effect of lowering interest rates and stimulating the economy.

Mario Draghi: President of the European Central Bank.

Quantitative Easing (QE): A government monetary policy occasionally used to increase the money supply by buying government securities or other securities from the market. Quantitative easing increases the money supply by flooding financial institutions with capital, in an effort to promote increased lending and liquidity.

Currency risk: Uncertainty in returns that comes from fluctuations in the exchange rate of one currency relative to another.

WisdomTree Europe Hedged Equity Fund (HEDJ)

WisdomTree Europe Hedged SmallCap Equity (EUSC)

Price-to-earnings (P/E) ratio: Share price divided by earnings per share. Lower numbers indicate an ability to access greater amounts of earnings per dollar invested.

Price-to-dividend ratio: Refers to the index price divided by the trailing 12-month dividends.

Dividend yield: a financial ratio that shows how much a company pays out in dividends each year relative to its share price.

S&P 500 Index: Market capitalization-weighted benchmark of 500 stocks selected by the Standard and Poor’s Index Committee designed to represent the performance of the leading industries in the United States economy.

Russell 2000 Index: measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000 is a subset of the Russell 3000 Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

Tripp Zimmerman, CFA
Director, Research
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Jeremy Schwartz, CFA
Global Head of Research
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