How to Play the Strong Dollar With ETFs

The video discusses the rising dollar and how investors can capitalize on it through currency ETFs. It highlights two main ETFs: PowerShares Dollar Bullish ETF, which focuses on developed markets, and WisdomTree Bloomberg U.S. Dollar Index ETF, which includes emerging markets. The video also explores the concept of currency hedging through equities, particularly the WisdomTree European Hedged ETF, which neutralizes currency risk. The discussion emphasizes the growth potential in this investment space as central banks weaken their currencies.

What is the primary focus of the PowerShares Dollar Bullish ETF?

• Hedging against the euro

• Going long on emerging market currencies

• Investing in multinational companies

• Shorting a basket of developed market currencies

Which ETF includes emerging market currencies in its strategy?

• WisdomTree Bloomberg U.S. Dollar Index ETF

• Ishares Eurozone ETF

• PowerShares Dollar Bullish ETF

• WisdomTree European Hedged ETF

Why might developed market currencies be more favorable to short?

• They are strengthening due to stimulus programs

• They are weakening due to stimulus programs

• They have higher yields

• They are less volatile

How does the WisdomTree European Hedged ETF manage currency risk?

• By focusing on U.S. stocks

• By investing in emerging markets

• By using forward contracts to short the euro

• By going long on the euro

What has been the impact of hedging on the performance of the WisdomTree European Hedged ETF compared to its non-hedged version?

• The non-hedged version is up 9%

• The non-hedged version is down 1%

• The hedged version is down 8%

• The hedged version is up 1%