Hedged vs Unhedged - Comparing Vanguard's International ETFs

Рет қаралды 15,176

Күн бұрын

In this video I'll talk about the differences between Hedged and UnHedged ETFs using Vanguard's VGS and VGAD as examples. This video will be broken into 3 parts: I'll run through a side by side comparison of the 2 ETFs then we'll look into some of the documentation that discusses the differences and then we'll look into how the performance varied over time and what might have caused it.
Timestamps:
0:00 - Introduction
1:35 - VGS vs VGAD Side by side comparison
4:42 - Documentation deep dive
6:58 - VGS vs VGAD Performance comparison
12:40 - My next video
Links:
My video on ETFs in Australia (Vanguard, BetaShares, iShares, StateStreet): • ETFs in Australia: 4 E...
My video on international ETFs: • Global ETFs: 4 ETFs to...
My video on Fixed income ETFs: • Bonds on CommSec: How ...
Ben Felix's video on Hedging your portfolio:
• Should You Currency He...
Vanguard Documentation about VGS and VGAD:
www.vanguardinvestments.com.a...#etfs
Other videos you might be interested in:
My video on Trading on CommSec: • CommSec Trading Tutori...
My video on ETFs in Australia (Vanguard, BetaShares, iShares, StateStreet): • ETFs in Australia: 4 E...
Nick Kendall’s (my friend’s) video on Buying shares on NAB Trade: • How To Buy Shares On A...
My Playlists:
Personal Finance: • Personal Finance
Investing: • Investing
Useful links:
Australian Government website on personal finances: moneysmart.gov.au
Disclaimer:
The information provided in this video is general in nature only and does not constitute personal financial advice. You should also consider seeking the advice of an investment advisor who holds an Australian financial services (AFS) licence or is a representative of an AFS licensee. Be sure to work with someone who understands your investment objectives and tolerance for risk. Your investment advisor should understand these products, be able to explain whether or how they fit with your objectives, and be willing to monitor your investment alongside you.

Пікірлер: 34

@Ms12213 Жыл бұрын

Hey Sanjee - great informative videos! Thank you. Looking forward to your new videos in 2023.

@simon_harrison 3 жыл бұрын

Great video mate, really enjoyed this one.

@SanjeeSen 3 жыл бұрын

Thanks Simon! Glad you liked it!

@brentonasmith 3 жыл бұрын

Great video and very clear explanation, thank you

@SanjeeSen 3 жыл бұрын

No worries Brenton! I'm actually cooking another video on Hedged vs Unhedged - hoping to come out soon.

@mercedeszacuto9774 Жыл бұрын

Thank you Sanjee, you saved me a lot of time of research.

@joshuachellew 2 жыл бұрын

Brilliant explanation and analysis.

@robbierolla 2 жыл бұрын

Love your content mate, format, tone, the works. Have been gorging on them for days since coming across your channel. Many tks.

@SanjeeSen 2 жыл бұрын

Glad you like them!

@payroll970 9 ай бұрын

Excellent explanation

@SanjeeSen 9 ай бұрын

Thanks!

@hv0e25 2 жыл бұрын

Thank you Sanjee. You have a good, calm and honest way of explaining complex things.

@SanjeeSen 2 жыл бұрын

You're most welcome

@petejames1326 2 жыл бұрын

@@SanjeeSen im looking at VGS.ax is there a US listed equivilent of VGS on the NYSE? because VGS is UNHEDGED isnt it? so if the AUD$ drop to say 60cUS the ETF goes up, if the AUD$ go up to 80cUS the ETF falls right?

@financialfreedomengineer1598 3 жыл бұрын

Great video Sanjee. Australians tend to have a home country bias so these ETF's are a great way to add some international diversification to our portfolios

@SanjeeSen 3 жыл бұрын

Thanks FFE! It was actually one of your articles that got me thinking about it. I'm slowly trying to boost my international exposure in my portfolio.

@Baz.a 3 жыл бұрын

Thanks for sharing the knowledge, I was looking for a comparison between VGS & VGAD and now it makes more sense. could you also do a comparison between VOO & IWLD?

@michaelm4970 Жыл бұрын

Thanks Sanjee

@TheRealPlethZorb 3 жыл бұрын

Cheers legend

@SanjeeSen 3 жыл бұрын

No worries!

@xavxav3250 3 жыл бұрын

Excellent video Sanjee! your tone and speed makes it easier to understand. Do you suggest go half and half VGS and VGAD. Im new to the investing world and I'm not sure which one to choose, I believe the AUD will be stronger than the USD soon, as the US keeps pumping money. Any suggestion of which one to choose base on the current global scenario?

@SanjeeSen 3 жыл бұрын

Hi Xav, this is a great question. I agree, I think the AUD is probably about to go into a period where it'll get stronger against the USD. However I'm not sure haha! I don't think any of us could be sure. 50 - 50 VGS and VGAD is a very reasonable strategy in general. Also it's important to note something like VGS actually has multiple currencies (even though USD is the most), we need to consider the impact of AUD against those other international currencies. That's why I think it makes sense to also go 100% VGAD if you're just interested in the international market gains and don't want to deal with the fluctuations of the currency.

@carllee8286 Ай бұрын

Hi Sanjee, thanks for another great video. Just wondering with BRICS/dedollarisation/ and its new currency - do you think hedged will be better going forward for long term aussie investors? Cheers!

@sheilawidjaja7331 3 жыл бұрын

Hi Sanjee. Thanks for the informative video. Quick question, what is your opinion of buying both VGAD and VGS? Thanks.

@SanjeeSen 3 жыл бұрын

Hi Sheila, great question! I think it's perfectly fine. I've started doing it myself!

@babupatel9368 3 жыл бұрын

Thanks Sanjee; I have one question : supposed I buy ETF today has "No currency hedged" say AUD $10,000 investment (0.74 USD rate). down the line - in 2022; when I will sell it - suppose - AUD will perform better than USD say ( 0.84 USD rate) ; is there any benefit of currency movement where there is no currency hedged ETF? I say No, am I correct ?

@SanjeeSen 3 жыл бұрын

Hi Babu, assuming the underlying companies don't really change - then yes the currency movement would actually work against you. So yes you're right in saying there wouldn't be any benefit in holding the no currency hedged ETF.

@thomasdaly1968 3 жыл бұрын

Hi Sanjee, any idea why VGAD dropped so much yesterday? Thanks. T

@myfriendshankar 2 жыл бұрын

Any idea why VGAD dropped so much compared to VGS recently ????

@nirmaal2255 Жыл бұрын

I am an international student. Let's say I have no ethical ETFs.(VAS/VGS) will that be an issue for me in the future?

@verjanso6025 3 жыл бұрын

So , in short, VGAD is more safe, right?

@SanjeeSen 3 жыл бұрын

Hi Verjanso, generally yes - it'll more around less. The way I see it is - VGS returns = Currency movements + Underlying company movements. Whereas, VGAD returns = Just underlying company movements. So you're cancelling out the variation that comes from AUD fluctuations. But it also means you might miss out on the gains that come from the AUD moving in a favourable way.

@tsingh7491 3 жыл бұрын

@@SanjeeSen Thanks for the video. Great Job. Following on the same topic, say an investor is of the opinion that AUD will fall against USD as in USD will start to get it gains back in the foreseeable future. Is VGAD (Hedged) a better choice?

@SanjeeSen 3 жыл бұрын

@@tsingh7491 Hi T Singh, in that case the unhedged version would be better "VGS" .