If our Canadian investor had purchased a hedged index fund,
eliminating their currency exposure, they would have captured the full 10 % return of the S&P 500 index without being dragged down by the falling US dollar.
Regarding
currency hedging, I also noticed they created today the «Claymore US Fundamental ETF (non-hedged)» http://claymoreinvestments.ca/etf/fund/clu.c And, I'm not making this up, I quote: «The Claymore US Fundamental Index ETF (non-hedged) will hedge its
exposure to US
currency to
eliminate foreign
currency return risk for Canadian investors.»