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Why have you chosen an unhedged security instead of hedged security for the Natural Resources asset class?
We prefer unhedged securities for the commodities asset class. The security for this asset class in our QuietGrowth Portfolios comprises the precious metal physical gold.
- Unhedged exposure allows aiming for diversification across different currencies.
- The product issuer incurs an extra cost so that the hedged security implements the hedging instrument. The product issuer might pass on this extra cost to the investor in the form of an increased expense ratio. Usually, this extra cost is a few basis points per annum.