As a European holding US stock indexes you are constantly affected by the USD to euro exchange rate. Most often this has actually worked in European holders' favour, because the euro weakened, thus inadvertently giving euros better returns on US stocks than to Americans. Recently the trend has reversed however. 2025 in particular was an absolute bloodbath, of what should've been nearly 20% gains on the S&P euros were left with only 5% because of the weakening of the USD. You could protect against this by buying a hedged index that uses future contracts to undo the effects of the exchange rate between the currencies, but then that would also leave you with lower returns if the dollar were to strengthen.What is /biz/'s opinion on the matter? Hedged or unhedged? It's essentially just speculating on if the USD strengthens or weakens against the euro in the long term.
>>62737933Should Americans buy land in white areas if Europe for when our country turns majority brown? I'm thinking northwest Ireland
>>62737933A lot of workplace pensions are partly hedged for this reason. You can replicate it with something like 50% VWRP + 50% IGWD
>>62737933It's the end of an era, take risk and gamble, rope if you fail.
>>62737933the exchange rate is relatively stablesometime it goes one way, sometimes the otherbut it always swings backso you dont need to hedge because it will balance out anyway
>>62737933>also calling yourself "europoor"kys
>>62737985There is the tail risk of the US deliberately choosing to pursue a weak dollar policy for whatever reason, like Japan did with the yen for many years. I don't know how likely that actually is to ever happen, but it's there. There is also the chance that the ECB and EU as a whole might deliberately take action to strengthen the euro (along with other measures) in order to shake people off American stocks and back onto European ones. In most other scenarios I agree though unhedged appears superior. And it has won historically too.
>>62738002I am both European and poor, however.
>>62738031when the dollar is weak american companies will also earn more and their stock price should go up more as a resultwhich also helps balance out
>>62737933Europeans investing in Amerikka should be shot for treason.
>>62738043Not really. Look at 2025. The stock market did pump but all the gains were undone. Imagine how it would look on a stronger slide down of the dollar.
>>62737933If you look into it you will see that the market in general has an inverse relation with the dollar, and the dollar an inverse relation with the euro. So if you keep cash you should put it in euros if you expect a bull market and in dollars if you expect a bear market. All the american indexes like the sp500, dow, nasdaq, etc have a wonderful look if you see them in euros, constant upwards trend with less volatility.But we could see the euro go to shit any day. The eurozone is on a serious decline. No energy, no resources and aging population. I cant see a reason to keep euros as fiat rn.
>>62738053100% of my networth is in the us market. fuck europe.
>>62738066europe never had energy or resourcesthis is our strength because our economy isnt relying on third world bullshit but actual high tech and manufacturing
>>62738053I hear your objection but people cannot be expected to sacrifice their livelihoods over moral reasons. The US has successfully engineered a scenario where it gets all of the world's money reinvested back into it and it's on other governments now to provide realistic alternatives.>>62738066>But we could see the euro go to shit any day. The eurozone is on a serious decline. No energy, no resources and aging population.That literally works in your favor if you're holding unhedged American stocks.
>>62738097>this is our strength because our economy isnt relying on third world bullshit but actual high tech and manufacturingare you serious? what tech lil gup?
>>62738043>>62738061Case in point. Imagine if you were holding the unhedged index and the euro to dollar rate starts a repeat of the 2000s for whatever reason. In that case the underlying stocks can go up as much as you like, you're still burning money holding it.
>>62738145im not talking about your overrated dot com internet bubble companies, PanchoEurope is actually high tech
>>62738168is this the so called "tech" we are talking about? lol
>>62738217the global leaders in plastic bottles comes from Europeeven when you try to make a stupid meme, you still failthat why Europe has a massive trade surplus and you desprately have to raise tariffs, because you cant compete
Its fine>euro weakens, your investments relatively climb>euro strengthens, your cash relatively climbs
>>62738168
>>62737933Hedge this dick niggers
>>62738289triggered all the mexicans I seenow desperately raise your tariffs again, because you cant compete with Europe
>>62737933>Recently the trend has reversed however.This isn't even true, the Euro hit 1 year lows today, everyone knows Europe is gonna be giga fucked for energy this winter
>>62738104Depends. In a shtf situation with the eurozone all the market would drop. Us equities too, and the dollar would look strong. Maybe gold could hold too.
>>62738300zoom outyou wont find a more boring chart as this
>>62738061The US stock market didn't pump too much in "real" terms in 2025, the USD currency did devaluate compared to EUR (but also CH and other currencies), the international companies listed on SP500 greatly increased earnings when nominated in USD, the stock prices increased accordingly.Almost every day, you can see an inverse relationship between USD/EUR and SP500, and as somebody said, the SP500 in EUR is smoother than the regular one.There is alot of arbitrage between FX, SP500 and bond rates, the market almost looks efficient.Sometimes, like during the eurozone crisis, the FX rates move a lot for other reasons. Then you can get fucked (or gain a lot) for holding in a foreign currency. Personally, I see more upside in being un-hedge.Don't buy US bonds as an EU, that's just bad risk/reward, and the hedge is too expensive on bonds.
>>62738315Ok, I zoomed out, looks like a downward trend to me!
No real idea why anyone outside the US holds S&P500. Better with an All world fund and bank on the index rebalancing over time to the next winner. Yes it will suffer in the meantime as it's heavily US tech weighted but stick with it.I bet most of you don't even realise there's a 15% US withholding tax on US dividends in the S&P500 for UK and EU so you are getting less return than Americans do for the same fund.
>>62738382>doesnt go anywhere for over ten years>downtrendsmartest mexicanno wonder you cant compete with Europe without tariffs
>>62738408the s&p500 makes up something like 2/3 of a msci world etf. its basically america + some losers.
>>62737933I don't do it because:Hedged EFTs have higher fees and the BCE had said several times that they aim for a 1.10 to 1.20 exchange.Also half of Europe want to print their way out of their debt or stagnation problems.So I don't see another -15% soon.
>>62738425>Also half of Europe want to print their way out of their debt or stagnation problemsthey cantthat is the advantage of the Euroits not controlled by an government and cant
>>62738408There're synthetic EFTs that reinvest dividends and pay 0 taxes in Europe.
>>62738434If France and Germany want, it happens. France wants it already, also Italy Spain and many others.
>>62738447Germany will never allow itand the rest doesnt matter
>>62738453Maybe, maybe not many things are changing, Germany is not doing good, also their exports are harmed by a strong Euro.They printed 1.8T during COVID.
>>62738300Oh no they gonna freeze this winter for realsies this time
>>62738466god, why dont you care about your own shitholeI really have bette things to do than waste my time with a fucking retard
>>62738475Lel, cry me a river mongoloid.
>>62738480thats funnywhat subhuman shithole do you come from anyway?
>>62738408your post makes no sense. do you think you don't pay the same withholding tax on US company dividends in an all-world fund? do you think you should only invest in your home market?
>>62737933Gespeichert.
>>62737942>Irish real estateIrish housing is absurdly overvalued because their tax system penalizes investment in any other form. If you hold stocks or ETFs in Ireland there's a like 33% capital gains tax for realized gains and another annual tax on unrealized gains.Means that even some shitty council flat built in the 50s full of black mold and mice will be worth nearly a million Euro because anyone with extra cash to invest are looking to buy and flip to students or tourists.
>>62738053There's zero reason to invest in Euro stocks as a Europoid, the return is negligible. Thankfully we have a continent of goycattle held in indentured servitude to their financial institutions, forced to invest in their corporations to be able to retire available to us to profit off of
>>62738531is that supposed to be english, Pancho?noone here believes your european, stop larping
>>62738487Austrian expat living in Spain, why? Keep moving the goalpost mongoloid.
>>62738546why are you calling me even mongoloid, are you stupid?
>>62738538I am an Anglo-Saxon living amongst filthy Continentoids. The longer I live here the more I realize that the thing you people really need is the firm but fair hand of the Anglo-Saxon race guiding your affairs. If you have to deal with a department that runs shockingly well in some French or Dutch firm, you know straight away that a Brit or one of their Commonwealth spawn is at the helm of it.
>>62738568the british are utter subhuman trashthis is the biggest bullshit I ever heard
>>62737933Slowly offload your gains to dollar ETFs that are bond based (SGOV, CSHI). Eventually (might take years), the euro will weaken again, that's when you convert it back to euro.>>62737942You can always move to whiter states. New England has a long way to go.>>62738053>not siphoning money out of exploited burgersI made a lot of money on UNH
>>62738676>New England has a long way to go.>>543458075
>>62738680>>>/pol/543458075
