ETF strategies to help Canadian investors combat a weak loonie + MORE Jan 29th

All about Canadian investments. Learn the ins and outs and get the latest news.
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ETF strategies to help Canadian investors combat a weak loonieWhile recent moves from the Bank of Canada and the U.S. Federal Reserve primarily influence borrowing costs, they’ve also contributed to a sharp divergence in currency exchange rates. Specifically, the Canadian dollar has depreciated significantly against the U.S. dollar. When interest rates in Canada drop more aggressively than those in the U.S., the yields on Canadian assets become less attractive to investors everywhere, prompting capital outflows. Meanwhile, higher U.S. rates make U.S. dollar–denominated assets more appealing, strengthening the greenback. The impact for Canadian investors is clear: U.S. stocks are now even more expensive to access.

Beyond paying brokerage commissions/spreads for currency conversions, you’re also getting fewer U.S. dollars for every Canadian dollar you exchange. Fortunately, exchange-traded funds (ETFs) offer several ways to hedge against this weakening Canadian dollar. Here’s a look at some options to consider.

Rankings

The best ETFs in Canada

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Unhedged U…

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