The ETF currency wars

In the last couple of years there has been a sizeable increase in the number of currency ETFs on the market and this has been accompanied by significant growth in the assets under management (AUM). Currency ETFs can be used to speculate on the anticipated movement in a particular exchange rate. They also allow investors to hedge the foreign exchange risk associated with the overseas holdings in their portfolio. Rarely have the currency returns been as significant as they have in the last few years. Initially it was the ultra loose monetary policy adopted by countries like the US and...