How can investors hedge against the falling euro?

Divergent monetary policy is causing currency volatility, and the euro has slumped. BlackRock's Stuart Reeve explores how European equity investors can weather the turbulence.

The third quarter of 2014 presented a modest pick-up in market volatility levels, as investors refocused on increasing geopolitical tensions and deflation risk in Europe. There is the potential for further rotations, as the market digests the prospect of life without quantitative easing (QE) in the US and UK. Divergent monetary policy After several years of globally synchronised central bank policy, the world’s economies are now entering a period of divergent monetary policy. One consequence of this situation will be currency volatility. This was evident recently in the devaluat...