Video: What Role Does Currency Management Play?

Most “diversified” portfolios contain non-U.S. stocks and non-U.S. bonds, and these foreign securities bring currency risk with them. However, most investors don’t pay enough attention to the currency risk of their stock and bond portfolios, according to William Blair’s Brian Singer. As he explains in this video, currency risk is inherent in all securities denominated in anything other than U.S. dollars, and this risk can be mitigated by fundamental investing in currencies. As Singer pointed out in an earlier video, fundamental value is a “powerful force” that can help guide long-term movements, and this may be even truer of currencies than other securities, which are inevitably denominated in currencies.

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