Puffer: Foreign fixed income requires currency hedging while equities should not
Marlene Puffer · Marlene Puffer – Canadian Pension Model at AIMCo (EP.337) · Sep 11, 2023 · at 57:23
Marlene Puffer, CIO of AIMCo, details how pension funds should differentiate currency hedging across fixed income versus equities.
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“Typically those would get hedged or fixed income like where the volatility of the return stream is low. The currency volatility can swamp that. And usually that's playing an asset liability function in the portfolio. So typically that kind of investment stream would get hedged, whereas public equities, private equity would more typically be unhedged because the diversification that comes from the asset mix itself usually is USD centric.”
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