Q&A: Unhedged ETF

unhedged funds

Photo ©iStockphoto.com/ Jonathan Lim Yong Hian

Question: You recently wrote a column advising people that they might want to consider unhedged funds that invest in U.S. securities in light of the declining Canadian dollar. iShares does not currently offer an unhedged version of its S&P 500 Index Fund (CAD-Hedged), although one is in the works. Can you suggest an alternative to XSP that is not Canadian dollar hedged? – Ross N.

Gordon Pape answers: Take a look at the BMO S&P 500 Index ETF (TSX: ZSP), which is unhedged. It’s a new exchange-traded fund, launched last November. There is also a Canadian dollar hedged version which trades under the symbol ZUE so be sure to get the one you want.

Do you have a money question you’d like to ask Gordon? Find out how to submit it here and then check out our Money section regularly to see if it was chosen for a response. Sorry, we cannot send personal answers.