For investors interested in finding out the painful areas of investing, WisdomTree Bloomberg US Dollar Bullish ETF (USDU) is probably on radar now. The fund just hit a 52-week low, and shares of USDU are down roughly 12.0% from their 52-week high price of $29.40/share.
Are more pains in store for this ETF? Let’s take a quick look at the fund and its near-term outlook to get a better idea of where it might be headed:
USDU in Focus
USDU looks to provide total returns, before expenses, that surpass the performance of the Bloomberg Dollar Total Return Index. The fund charges 50 bps in fees (see all currency ETFs here).
Why the Move?
The U.S. dollar has been an area to watch lately as the Fed remains dovish on the policy tightening issue. Challenges posed by the global market and moderation in U.S. growth held the Fed back from taking forward the policy tightening step that it took in December 2015 for the first time after almost a decade. The U.S. economy grew at the weakest clip in two years in the first quarter of 2016. This along with a dovish Fed marred the appeal of the U.S. dollar.
More Pains Ahead?
The fund has negative weighted alpha of 9.90. A negative weighted alpha hints at more pains. As a result, the near-term outlook for this fund is choppy.
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WISDMTR-BB USDB (USDU): ETF Research Reports
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U.S. Dollar Bullish ETF (USDU) Hits New 52-Week Low
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