WITH INSTITUTIONAL ASSET MANAGERS INCREASINGLY looking worldwide for sources of return, it seems like a no-brainer that they would pay more attention to currency risks. But most U.S. firms still leave their portfolios unhedged. “In the United States we have found that very few institutional investors have currency hedging programs in place,” says Michael DuCharme, senior currency strategist at Seattle-based investment adviser Russell Investments, which provides such programs. “We find that people in the United Kingdom, Europe, Asia and Australia are much more aware of these currency effects.”

Many U.S. asset managers have looked at the dollar’s movements over the past decade and concluded that “there is no point in hedging because over time it’s kind of a wash,” says Alan Kosan, head of alpha investment research at Darien, Connecticut–based advisory shop Segal Rogerscasey. Kosan’s firm and other specialists in currency risk don’t share that view.

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