ETF Shares offers new currency hedged ETFs

ETF Shares has launched two new currency hedged ETFs aiming to reduce the impact of currency movements when investing in US technology companies.

The new ETFs are the ETFS Magnificent 7+ Currency Hedged ETF (ASX: HULK) and ETFS US Technology Currency Hedged ETF (ASX: HTTP).

They provide currency hedged exposure to the same portfolios as the ETFS Magnificent 7+ ETF (ASX: HUGE) and the ETFS US Technology ETF (ASX: WWWW), respectively.

The new ETFs have the same management fees as their unhedged counterparts. HULK has a management fee of 0.19% p.a., while HTTP charges 0.17% p.a.

ETF Shares chief executive Cliff Man said currency hedging should not automatically mean investors pay more.

"Currency hedging is often used as an excuse to charge investors a higher fee. We don't think that is justified," Man said.

"We have built these products to be straightforward extensions of HUGE and WWWW. Investors can choose whether they want the underlying US equity exposure with or without currency hedging, without paying a premium for the hedged option."

The launch also addresses a practical issue for local investors seeking a currency hedged exposure to US technology companies.

"Advisers have told us that currency hedging is particularly useful as there isn't an equivalent US-listed product they can simply buy themselves," Man added.

"These are Australian-listed ETFs designed specifically for Australian investors. They provide access to the underlying US companies, with the currency exposure managed within the fund, rather than requiring investors to manage the currency themselves.

"WWWW was designed to reflect where technology and technology-driven growth actually sit in the US market. HTTP gives investors the same exposure while managing the Australian dollar component."

The launch takes ETF Shares' range to seven ETFs, including two ETFs focusing on commodities rolled out in April, and follows the recent reduction in the fee on WWWW from 0.29% to 0.17% p.a.