Podcasts & Videos

How to Manage Currency Risk in Emerging Markets

Currency risk can play a significant role in emerging market portfolios. Check out this video to learn how our multi-factor approach can help manage the risk.

Emerging markets offer a wide variety of return potential, but they also tend to come with higher levels of volatility. So, that’s why we believe that allocating to emerging markets requires a more fundamentally grounded approach. Currency risk can play a significant role in emerging market portfolios. The WisdomTree Emerging Markets Multifactor Fund, ticker EMMF, has the ability to dynamically adjust higher and lower the currency of the portfolio. Therefore, when emerging market currencies are appreciating versus the dollar, it has the potential to capture those returns. However, when markets are trending lower, it has the ability to hedge those currencies to reduce risk and also protect to the downside.