19. Hedging Currency Exposure Reduces Your Risk
Currency hedging is another strategy that can be challenging to achieve results with. To reduce the risk of unfavorable exchange rate shifts when holding a stock in foreign currency, investors should have an “equal but opposite position in the currency itself,” according to Fidelity.
However, even professional investors have difficulty timing currency. And there’s a level of effort and cost involved for returns that aren’t necessarily significant, Fidelity noted — so the strategy might not be worth it.
