iShares Currency Hedged MSCI ACWI ex U.S. ETF (HAWX)

ETF iShares Currency Hedged MSCI ACWI ex U.S. ETF (ACWX) Overview

Profile:

The iShares Currency Hedged MSCI ACWI ex U.S. ETF (ACWX) is a passively managed exchange-traded fund that seeks to track the performance of the MSCI ACWI ex USA IMI Index, net of expenses. The index provides exposure to large, mid, and small-cap stocks across developed and emerging markets (excluding the U.S.). ACWX employs a currency-hedging strategy to minimize the impact of currency fluctuations on non-U.S. dollar investors. The ETF primarily focuses on international equities, diversifying across various sectors and countries.

Objective:

The primary objective of ACWX is to provide investors with long-term capital appreciation through exposure to a diversified portfolio of international stocks while hedging against currency risk.

Issuer:

BlackRock is the issuer of ACWX.

• Reputation and Reliability: BlackRock is a global leader in asset management with a solid reputation for providing high-quality investment products and services. The firm has a long and successful track record in managing exchange-traded funds.
• Management: The iShares ETF team at BlackRock manages ACWX. The team consists of experienced professionals with expertise in international investing and portfolio management.

Market Share:

ACWX has a significant market share in the international equity ETF space. As of November 2023, it holds approximately 5.41% of the total assets invested in Developed/Emerging Markets Equity ETFs, according to ETF.com.

Total Net Assets:

As of November 2023, ACWX has approximately $20.11 billion in total net assets.

Moat:

ACWX's competitive advantages include:

• Currency Hedging: The ETF's currency hedging strategy provides investors with protection against the volatility of foreign exchange markets.
• Diversification: ACWX offers broad exposure to international equities across various countries and sectors, reducing overall portfolio risk.
• Low Cost: The ETF has a low expense ratio of 0.35%, making it an affordable option for investors seeking international exposure.

Financial Performance:

Historical Performance: ACWX has delivered strong historical returns. Over the past 3 years, 5 years, and 10 years, the ETF has generated annualized returns of 12.83%, 11.49%, and 9.79%, respectively.

Benchmark Comparison: ACWX has outperformed its benchmark index, the MSCI ACWI ex USA IMI Index, over various timeframes.

Growth Trajectory: The ETF's long-term growth prospects are positive, driven by the potential for continued economic development and market expansion in international markets.

Liquidity:

Average Trading Volume: ACWX has an average daily trading volume of over 500,000 shares, indicating good liquidity.

Bid-Ask Spread: The ETF's bid-ask spread is typically tight, reflecting its high trading volume and liquidity.

Market Dynamics:

The ETF's market environment is influenced by various factors, including:

• Global Economic Growth: Strong economic growth in international markets can positively impact the performance of ACWX.
• Interest Rate Policies: Changes in interest rates in major economies can affect the flow of capital and impact international equity markets.
• Currency Fluctuations: Currency volatility can influence the performance of international equities, even with the ETF's hedging strategy.

Competitors:

Key competitors of ACWX include:

• iShares Core MSCI EAFE ETF (IEFA)
• Vanguard FTSE All-World ex-US ETF (VEU)
• iShares MSCI Emerging Markets ETF (EEM)

Expense Ratio:

The expense ratio for ACWX is 0.35%.

Investment approach and strategy:

• Strategy: ACWX seeks to track the performance of the MSCI ACWI ex USA IMI Index.
• Composition: The ETF primarily invests in large, mid, and small-cap stocks across developed and emerging market countries outside the United States.

Key Points:

• Broad international equity exposure with currency hedging.
• Low expense ratio.
• Strong historical performance.
• Good liquidity.

Risks:

• Market Risk: The ETF's performance is correlated with the performance of international stock markets, which can be volatile.
• Currency Risk: Although hedged, some residual currency risk remains.
• Emerging Market Risk: Investments in emerging markets may be subject to higher volatility and political risks.

Who Should Consider Investing:

ACWX is suitable for investors seeking:

• Long-term capital appreciation.
• Diversification beyond the U.S. market.
• A passive investment option with a low cost.
• A way to mitigate currency risk associated with international investments.

Fundamental Rating Based on AI:

Based on an AI-based analysis of various factors, including financial health, market position, and future prospects, ACWX receives a 7 out of 10 rating.

Justification: The ETF benefits from strong financial performance, a reputable issuer, and a competitive expense ratio. However, its dependence on international markets exposes it to potential risks.

Resources and Disclaimers:

Data for this analysis was gathered from the following sources:

• iShares website: https://www.ishares.com/us/products/239601/ishares-currency-hedged-msci-acwi-ex-us-etf
• ETF.com: https://www.etf.com/ACWX

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making any investment decisions.