Is It Time to Currency Hedge Your S&P 500 ETF? Key Factors to Consider

Is It Time to Currency Hedge Your S&P 500 ETF? Key Factors to Consider If you’ve invested in an S&P 500 ETF, you're likely riding the rollercoaster of the stock market, hands gripping the sidebars as the value swings up and down. But wait, there’s another ride to consider: currency risk. Should you currency hedge your S&P 500 ETF right now, or just hold on and enjoy the ride? Let’s break it down. First Things First: What Is Currency Hedging? Before we dive into the nitty-gritty, let’s clarify what currency hedging actually means. Imagine you're planning a vacation to Europe, but you’re worried the dollar might lose value against the euro while you’re sipping espresso in Rome. Currency hedging in the world of investments is like taking out travel insurance against that very scenario. It’s a strategy designed to minimize the potential loss caused by fluctuations in the exchange rate.