BlackRock, Inc., begun trading of 3 new ETFs, the iShares Adaptive Currency Hedged MSCI EAFE ETF (BATS: DEFA), the iShares Adaptive Currency Hedged MSCI Eurozone ETF (BATS: DEZU), and the iShares Adaptive Currency Hedged MSCI Japan ETF (BATS: DEWJ) on Wednesday, January 06, 2015. Here is a synopsis of the new ETFs:
1.
FUND INFORMATION: CLOSED 08/23/2021
| Symbol: DEFA | Exchange: BATS |
| Name: iShares Adaptive Currency Hedged MSCI EAFE ETF | Net Expense Ratio: 0.35% |
FUND OBJECTIVE:
The iShares Adaptive Currency Hedged MSCI EAFE ETF seeks to track the investment results of the MSCI EAFE Adaptive Hedge to USD Index.
As of its inception date, the Fund intends to seek to achieve its investment objective by investing a substantial portion of its assets in the ISHARES MSCI EAFE ETF (EFA). In order to replicate the “hedging” component of the Underlying Index, which attempts to mitigate currency risk, the Fund intends to enter into foreign currency forward contracts designed to offset the Fund’s holdings in component securities denominated in a non-U.S. dollar currency. The weighted average hedge ratio for the MSCI EAFE Adaptive Hedge to USD Index is currently 52%.
REFERENCE INDEX:
The MSCI EAFE Adaptive Hedge to USD Index has been developed by MSCI Inc. (Index Provider) as an equity benchmark for international stock performance with the foreign currency exposure of the securities included in the Underlying Index dynamically hedged against the U.S. dollar determined systematically by 4 currency risk indicators:
* value (relative purchasing power between the foreign currency and the U.S. dollar based on exchange rates over a long-term average),
* momentum (relative price momentum of the foreign currency compared against the U.S. dollar over the previous six months),
* carry (differences in short-term interest rates between the foreign currency and the U.S. dollar over a long-term average), and
* volatility (relative price volatility of the foreign currency based on the currency’s one-month average against its six-month average).
The overall effect, since the four indicators are equally weighted, is that each foreign currency represented by constituent weights in the Underlying Index can be unhedged, 25% hedged, 50% hedged, 75% hedged or fully hedged relative to the U.S. dollar.
As of December 11, 2015, the Underlying Index consisted of securities from the following countries or regions: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the United Kingdom. The Underlying Index may include large-, mid- or small-capitalization companies. Components primarily include consumer discretionary, financials and industrials companies.
Fund’s Holdings (01/08/2016):
Name |
Weight |
| ISHARES MSCI EAFE ETF (EFA) | 100.1% |
Index Underlying Top Holdings (01/08/2016):
Symbol |
Name |
| NESN | NESTLE SA |
| NOVN | NOVARTIS AG |
| ROG | ROCHE HOLDING AG |
| 7203 | TOYOTA MOTOR CORP |
| HSBA | HSBC HOLDINGS PLC |
| NOVO B | NOVO NORDISK CLASS B |
| BATS | BRITISH AMERICAN TOBACCO PLC |
| SAN | SANOFI SA |
| ABI | ANHEUSER BUSCH INBEV SA |
| CBA | COMMONWEALTH BANK OF AUSTRALIA |
Index Country Allocation (01/08/2016):
| Japan | 23.70% |
| United Kingdom | 19.23% |
| France | 9.63% |
| Switzerland | 9.42% |
| Germany | 8.90% |
| Australia | 6.55% |
| Spain | 3.15% |
| Hong Kong | 3.11% |
| Netherlands | 2.87% |
| Sweden | 2.81% |
Useful Links:
DEFA Home Page
Category: Equities> International Equities> International Broad
2.
FUND INFORMATION:
| Symbol: DEZU | Exchange: BATS |
| Name: iShares Adaptive Currency Hedged MSCI Eurozone ETF | Net Expense Ratio: 0.50% |
FUND OBJECTIVE:
The iShares Adaptive Currency Hedged MSCI Eurozone ETF seeks to track the investment results of the MSCI EMU Adaptive Hedge to USD Index.
As of its inception date, the Fund intends to seek to achieve its investment objective by investing a substantial portion of its assets in the ISHARES MSCI EUROZONE ETF (EZU). In order to replicate the “hedging” component of the Underlying Index, which attempts to mitigate currency risk, the Fund intends to enter into foreign currency forward contracts designed to offset the Fund’s holdings in component securities denominated in a non-U.S. dollar currency. The weighted average hedge ratio for the MSCI EMU Adaptive Hedge to USD Index is currently 50%.
REFERENCE INDEX:
The MSCI EMU Adaptive Hedge to USD Index has been developed by MSCI Inc. (Index Provider) as an equity benchmark for the European Monetary Union (EMU) countries with the foreign currency exposure of the securities included in the Underlying Index dynamically hedged against the U.S. dollar determined systematically by 4 currency risk indicators:
* value (relative purchasing power between the foreign currency and the U.S. dollar based on exchange rates over a long-term average),
* momentum (relative price momentum of the foreign currency compared against the U.S. dollar over the previous six months),
* carry (differences in short-term interest rates between the foreign currency and the U.S. dollar over a long-term average), and
* volatility (relative price volatility of the foreign currency based on the currency’s one-month average against its six-month average).
The overall effect, since the four indicators are equally weighted, is that each foreign currency represented by constituent weights in the Underlying Index can be unhedged, 25% hedged, 50% hedged, 75% hedged or fully hedged relative to the U.S. dollar.
As of December 11, 2015, the Underlying Index consisted of securities from the following countries: Austria, Belgium, Finland, France, Germany, Ireland, Italy, the Netherlands, Portugal and Spain. The Underlying Index may include large-, mid- or small-capitalization companies. Components primarily include consumer discretionary, financials and industrials companies.
Fund’s Holdings (01/08/2016):
Name |
Weight |
| ISHARES MSCI EUROZONE ETF (EZU) | 100.7% |
Index Underlying Top Holdings (01/08/2016):
Symbol |
Name |
| SAN | SANOFI SA |
| ABI | ANHEUSER BUSCH INBEV SA |
| BAYN | BAYER AG |
| FP | TOTAL SA |
| ALV | ALLIANZ SE |
| SAP | SAP |
| SIE | SIEMENS AG |
| DAI | DAIMLER AG |
| UNA | UNILEVER DRC NV |
| SAN | BANCO SANTANDER SA |
Index Country Allocation (01/08/2016):
| France | 32.22% |
| Germany | 29.74% |
| Spain | 10.52% |
| Netherlands | 9.54% |
| Italy | 7.88% |
| Belgium | 4.82% |
| Finland | 3.41% |
| Ireland | 1.37% |
Useful Links:
DEZU Home Page
Category: Equities> Regions> Europe> Broad Europe> All Europe
3.
FUND INFORMATION:
| Symbol: DEWJ | Exchange: BATS |
| Name: iShares Adaptive Currency Hedged MSCI Japan ETF | Net Expense Ratio: 0.47% |
FUND OBJECTIVE:
The iShares Adaptive Currency Hedged MSCI Japan ETF seeks to track the investment results of the MSCI Japan Adaptive Hedge to USD Index.
As of its inception date, the Fund intends to seek to achieve its investment objective by investing a substantial portion of its assets in the ISHARES MSCI JAPAN INDEX FUND (EWJ). In order to replicate the “hedging” component of the Underlying Index, which attempts to mitigate currency risk, the Fund intends to enter into foreign currency forward contracts designed to offset the Fund’s holdings in component securities denominated in a non-U.S. dollar currency. The weighted average hedge ratio for the MSCI Japan Adaptive Hedge to USD Index is currently 25%.
REFERENCE INDEX:
The MSCI Japan Adaptive Hedge to USD Index has been developed by MSCI Inc. (Index Provider) as an equity benchmark for stocks traded primarily on the Tokyo Stock Exchange with the foreign currency exposure of the securities included in the Underlying Index dynamically hedged against the U.S. dollar determined systematically by 4 currency risk indicators:
* value (relative purchasing power between the foreign currency and the U.S. dollar based on exchange rates over a long-term average),
* momentum (relative price momentum of the foreign currency compared against the U.S. dollar over the previous six months),
* carry (differences in short-term interest rates between the foreign currency and the U.S. dollar over a long-term average), and
* volatility (relative price volatility of the foreign currency based on the currency’s one-month average against its six-month average).
The overall effect, since the 4 indicators are equally weighted, is that each foreign currency represented by constituent weights in the Underlying Index can be unhedged, 25% hedged, 50% hedged, 75% hedged or fully hedged relative to the U.S. dollar.
The Underlying Index may include large-, mid- or small-capitalization companies. Components primarily include consumer discretionary, financials and industrials companies.
Fund’s Holdings (01/08/2016):
Name |
Weight |
| ISHARES MSCI JAPAN INDEX FUND (EWJ) | 100.2% |
Index Underlying Top Holdings (01/08/2016):
Symbol |
Name |
| 7203 | TOYOTA MOTOR CORP |
| 8306 | MITSUBISHI UFJ FINANCIAL GROUP INC |
| 7267 | HONDA MOTOR LTD |
| 9984 | SOFTBANK GROUP CORP |
| 8316 | SUMITOMO MITSUI FINANCIAL GROUP IN |
| 8411 | MIZUHO FINANCIAL GROUP INC |
| 9433 | KDDI CORP |
| 2914 | JAPAN TOBACCO INC |
| 4502 | TAKEDA PHARMACEUTICAL LTD |
| 3382 | SEVEN & I HOLDINGS LTD |
Useful Links:
DEWJ Home Page
Category: Equities> Regions> Asia> Developed Asia Equities> Japan
ETFtrack comment:
Here is a comment from Ruth Weiss, Head of U.S. iShares Product at BlackRock:
“iShares Adaptive Currency Hedged ETFs offer a single solution for investors looking to gain exposure to international equity returns, without having to worry about when to hedge or unhedge the associated foreign currency exposure. Investors have seen how fluctuating exchange rates can impact their global equity returns, but trying to anticipate or react to currency movements is difficult and requires frequent monitoring.”