Shark Tank's O'Leary Tries His Hand At Currency Hedged ETFs

“Shark Tank” star Kevin O'Leary is taking his foray into the exchange traded funds industry seriously. Just over a month past the debut of his first ETF and not even a week after his ETF firm, O'Shares Investments, added two more funds, two more O'Shares ETFs launched Tuesday.

The O'Shares FTSE Asia Pacific Quality Dividend Hedged ETF OAPH and the O'Shares FTSE Europe Quality Dividend Hedged ETF OEUH represent O'Shares' initial currency hedged offerings. With the dollar being the best-performing developed market currency for much of 2015, currency hedged ETFs have been among this year's most prolific asset gatherers.

Through the first six months of the year, currency hedged ETFs hauled in $41 billion in new assets and three of the top 10 asset-gathering ETFs on a year-to-date basis are currency hedged funds.

The O'Shares FTSE Asia Pacific Quality Dividend Hedged ETF tracks the FTSE Asia Pacific Qual / Vol / Yield Factor 5% Capped Hedged 100% to USD Index.

That benchmark “is designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the Asia Pacific that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield, as determined by FTSE-Russell,” according to O'Shares. 

OAPH is the currency hedged equivalent of the O'Shares FTSE Asia Pacific Quality Dividend ETF OASI, which debuted last week. 

Like OASI, OAPH is primarily a developed markets play as Japanese and Australian stocks combine for about two-thirds of the fund's weight. Another 19.2 percent is allocated to Hong Kong.

The O'Shares FTSE Europe Quality Dividend Hedged ETF is the hedged European currencies answer to the O'Shares FTSE Europe Quality Dividend ETF OEUR, which also debuted last week.

OEUH, the currency hedged ETF, follows the FTSE Europe Qual / Vol / Yield Factor 5% Capped Hedged 100% to USD Index.

That index “is designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in Europe that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield, as determined by FTSE-Russell,” according to O'Shares. 

Like its unhedged counterpart, OEUH is not a dedicated Eurozone ETF. Rather, the new fund offers exposure to countries that are not in the Eurozone in addition to Eurozone members. The UK and Switzerland combine for 62.7 percent of OEUH's weight. France is the new ETF's largest Eurozone weight at 12.9 percent, according to issuer data.

Both currency hedged ETFs from O'Shares charge 0.68 percent per year, or $68 per $10,000 invested. The firm's first ETF, the O'Shares FTSE US Quality Dividend ETF OUSA, has attracted $22.5 million in assets in just six weeks of trading.