Some of our funds invest in overseas shares and bonds and are therefore exposed to exchange rate movements.
Hedged share classes aim to reduce the risk of losses due to changes in exchange rates. This involves using financial contracts to secure a specific exchange rate.
As a result, your returns generally reflect how the investment itself performs – not how the currency moves.
An unhedged share class can be fully exposed to exchange rate movements between the pound and the currency of the underlying assets in the fund.
If the foreign currency strengthens against the pound, your returns may increase. But if it weakens, your returns could be lower.
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