THE AUSTRALIAN DOLLAR - IS NOW THE TIME TO HEDGE?

CIO MONTHLY | OCTOBER 2017

What are likely to be the key drivers of the Australian dollar in the months ahead? And should investors consider hedging their currency risk?


At Crestone, we believe that global diversification should be at the core of each investor's strategy. A globally diversified portfolio is likely to be better positioned to weather large movements in markets, and provide a more stable set of returns over time. However, one of the implications of a globally diversified portfolio is that currency fluctuations can have an impact on investment returns - both positively and negatively.

As such, an important question for investors is whether they want to take this risk, or if currency risk is something they should consider hedging.

In this article, we ask whether an investor should consider hedging currency risk at all, and look at the key drivers of the Australian dollar in the months ahead.