CEW ETF Goes Deeper Into Emerging Markets

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May 12, 2009 9:32am NYSE:CEW

emergingmarketsThe WisdomTree Dreyfus Emerging Currency Fund(CEW Quote), WisdomTree’s newest exchange-traded fund, may help investors outperform markets more than some stock-and-bond mutual funds.

WisdomTree sells seven single-currency funds. WisdomTree Dreyfus Emerging Currency Fund is a basket of currencies equally weighted to the Mexican peso, Brazilian real, Chilean peso, South African rand, Polish zloty, Israeli shekel, Turkish new lira, Chinese yuan, South Korean won, Taiwan dollar and the Indian rupee. The fund rebalances quarterly.

The fund’s function is to provide access to the currency fluctuation of a diversified emerging market basket along with money market yields from those countries. It will have small positions in the requisite currencies via swaps contracts, which will be collateralized by U.S.-denominated money market instruments. The swaps will provide the foreign exchange exposure.

Emerging market currencies is a relatively new asset class for access in a brokerage account. Currencies typically don’t offer the potential growth of individual stocks, but, used properly and in moderation, offer excellent diversification by reducing a portfolio’s correlation to the broader market and enhancing performance.

Full Story: http://www.thestreet.com/_aol/story/10498583/1/etf-goes-deeper-into-emerging-markets.html?cm_ven=AOL&cm_cat=Free&cm_pla=Feed&cm_ite=Feed

See our previous story: http://etfdailynews.com/blog/?p=2006

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