Every Currency-Hedged ETF on the ASX: The Complete Guide

Currency hedging is one of the most consequential decisions you can make with an international ETF — and in 2025, getting it right meant the difference between a +20% year and a +7% year. The AUD fell roughly 12% against the USD, and every single hedged ETF outperformed its unhedged equivalent by 10 to 33 percentage points.

But this is not a story about hedged always winning. When the AUD rises — as it did in 2020 and 2021, recovering from 0.60 to 0.78 — unhedged wins by the same margins. The decision about whether to hedge is one of the most misunderstood choices in Australian investing.

This is the complete list of all 71 hedged ETFs, grouped by theme, with data on AUM, fees, 1-year and 3-year returns, and clear guidance on when each makes sense. For a deeper dive into the strategic decision between hedged and unhedged, see Hedged vs Unhedged ETFs: When to Use Each and the Hidden Cost of Getting It Wrong.

How Currency Hedging Works

The concept is simpler than it sounds.

When you buy VGS — the unhedged version of Vanguard's international shares ETF — your return has two components: the return of the underlying international shares, and the movement of the AUD relative to the currencies those shares are priced in. If the AUD falls, you get a bonus return on top of your share gains. If the AUD rises, you give back some of your returns.

When you buy VGAD — the hedged version — currency movement is neutralised using forward foreign exchange contracts. You get the international share return only.

If AUD falls: unhedged investors lose on conversion when they eventually sell → hedged wins.

If AUD rises: unhedged investors get a currency bonus → unhedged wins.

The cost of running the hedge is real but small — typically 0.03% to 0.10% per annum in additional costs (on top of any fee difference), as the fund manager constantly rolls forward contracts.

The bond exception is important. For fixed-income ETFs, virtually every professional manager recommends hedging as a default. The reason: bond yields are typically 3–6% per annum, but AUD/USD can move 10–20% in a single year. Currency volatility completely swamps the return on bonds. An unhedged global bond ETF is really just a currency bet with a bond wrapper. VBND and VIF both hedge for exactly this reason.

For equities, the debate is genuinely ongoing. Many advisers recommend a 50/50 mix, or staying unhedged for long-term investors on the basis that currency movements average out over a decade. The data from 2025 shows hedged won decisively. The data from 2020–2021 shows unhedged won decisively. Over very long periods, neither has a consistent structural edge.

Where the Money Sits

$43 billion in currency-hedged ETFs is concentrated in a handful of funds. The top five alone account for $18.2 billion — nearly half the total.

Top 5 by AUM:

What's notable here: VGAD is more than three times larger than the next-best hedged global equity ETF, yet it charges 0.21% — nearly double what HGBL charges at 0.11%. First-mover advantage is real in the ETF industry.

The bond side of the table tells its own story. VBND at $4 billion is the second-largest hedged ETF on the ASX — reflecting the consensus that bond investors should always hedge.

The Complete List: Grouped by Category

1. Global & US Equities — Hedged

This is the core of the hedged ETF universe. 23 funds, $17.2 billion in AUM. These funds give you exposure to developed market shares with AUD currency risk removed.

What the data tells you:

VGAD at $6.4 billion is the default hedged global equity ETF for most Australian investors — it's been around since 2014 and commands enormous trust and liquidity. But HGBL at 0.11% MER is now the cheapest hedged global option, undercutting VGAD by 0.10 percentage points per year. Over 20 years, that difference compounds meaningfully.

IHVV at 0.10% is the cheapest hedged S&P 500 option and one of the cheapest ETFs on the ASX in any category. WXHG also comes in at 0.10% with a carbon-aware tilt. MQHG at 0.18% is interesting — a new active hedged fund from Macquarie at a passive-like price.

QHAL adds a quality screen (high return on equity, earnings stability, low leverage) and has generated strong 3-year numbers of +73.0%. Its 0.43% fee is higher than VGAD, but the quality factor has historically added value. HNDQ is the natural choice for hedged Nasdaq-100 exposure.

The active managers (TLRH, NNWH, DAOR, LPHD, CGHE, L1HI) charge 1.0–1.25% and have mixed results. DAOR returned -1.3% over the past year — a period when passive hedged global equities returned +17–20%. CGHE returned -8.7%. NNWH returned +24.9%, which looks impressive but is a very short track record. The broad consensus from Active vs Passive ETF research is that active managers consistently fail to outperform after fees over the long term.

IVHG at +46.6% 1-year return is a standout — the value factor combined with currency hedging was a powerful combination when the AUD was falling and value stocks were recovering.

2. Regional Equities — Hedged

Five funds, $0.5 billion. These let you make targeted bets on specific geographic regions with currency risk removed.

The Japan story is the most compelling in the entire hedged ETF universe.

HJPN returned +54.8% over the past year. Its unhedged equivalent IJP returned +24%. The 30-percentage-point gap came entirely from currency hedging. Japan's market was already strong, but the combination of a weak AUD (down ~12% vs USD) and a weak JPY (already weak relative to AUD) made HJPN an extraordinary performer. Over three years, HJPN returned +128.2%.

HVLU at +39.8% shows the same pattern — the value factor in international markets combined with a falling AUD creates outsized hedging benefit. H100 at +25.7% reflects the strength of UK large-cap equities, particularly energy and financial stocks.

QHSM is the only small-cap hedged option on the ASX. The 0.62% MER is fair for small-cap exposure with a quality screen.

3. Infrastructure & Property — Hedged

Ten funds, $8.8 billion. Infrastructure and property are the asset classes where hedging makes the most intuitive sense: you're buying stable, long-duration, yield-generating assets — and you don't want AUD volatility to disrupt your income stream.

Infrastructure is the one category where hedging is close to consensus.

Global infrastructure assets (airports, toll roads, utilities, pipelines) pay income in foreign currencies. If you're an Australian investor relying on that income, AUD appreciation eats directly into your distributions. Hedging removes that risk.

IFRA at $1.9 billion and 0.20% MER has been the default for most investors since 2016. GLIN at 0.15% now undercuts it — and with similar underlying exposure to the FTSE Global Core Infrastructure Index, there's a strong case to prefer GLIN for new investors. Both returned approximately +21% over the past year.

The big story is the ClearBridge funds: CIIH and CIVH launched in April 2025 and immediately attracted $1.3B and $1.2B respectively. That is an extraordinary level of inflows for brand-new funds. The 1.025% MER is high, but ClearBridge is one of the world's largest infrastructure managers, and institutional investors clearly followed. No performance data is available yet.

MICH from Magellan charges 1.06% and returned +25.9% over the past year — outperforming the passive funds. Its 5-year return of +52.1% roughly matches IFRA's +52.3%. Magellan's active management hasn't added meaningful alpha over the long run, but it hasn't destroyed value either.

LEND is the exception that proves the rule about hedging. This hedged private credit ETF returned -16.3% — a reminder that hedging protects you from currency risk, not from bad underlying investments. The private credit market faced significant headwinds in 2024–2025. For more on property and infrastructure options on the ASX, see Every Property & Infrastructure ETF on the ASX.

4. Bonds & Fixed Income — Hedged

Seventeen funds, $8.3 billion. This is the category where hedging is not a debate — it's the correct answer.

Why all global bond ETFs should be hedged:

A global aggregate bond ETF yields around 3–5% per year. The AUD can move 10–20% in a single year. An unhedged global bond ETF isn't a bond investment — it's a currency speculation that happens to hold bonds. The hedged versions (VBND, VIF, USTB) deliver what you actually want from bonds: stable, predictable income that diversifies your equity holdings.

VBND at $4.0 billion is the dominant hedged bond ETF. At 0.20% MER, it provides broad global investment-grade bond exposure. VIF focuses on government bonds only (lower yield, lower risk). USTB at 0.19% focuses specifically on US Treasuries — a popular choice when investors are concerned about credit risk.

GGOV deserves special attention. GGOV holds 20+ year US Treasury bonds. This is an instrument for making aggressive bets on interest rate direction — if you believe rates will fall significantly, long-duration bonds deliver outsized gains. The flip side: its 5-year return is -29.7%, the worst in the entire bond ETF universe, because rate hikes in 2022 destroyed long-duration bond prices. GGOV is not a defensive holding. It is a tactical, directional trade on rate cuts.

HCRD is unique in this list. HCRD is interest rate hedged, not currency hedged. It holds Australian corporate bonds and uses interest rate swaps to neutralise duration risk — so you get credit spread return without the interest rate sensitivity. If you want corporate bond yield without worrying about rate moves, HCRD is purpose-built for that. Its +6.1% 1-year return and +24.5% 3-year return are the best numbers in the domestic bond space.

IHEB at +11.4% stands out in the fixed income table — emerging market bonds carry significantly more risk and reward than investment-grade developed-market bonds. For a complete breakdown of bond options, see The Complete Guide to Bond ETFs on the ASX.

5. Commodities, Sector & Thematic — Hedged

Eleven funds, $3.0 billion. These funds span gold, oil, agriculture, healthcare, financials, and the new covered-call income series from JPMorgan.

The gold story is the defining performance narrative of 2025.

QAU returned +76.9% over the past year. Its unhedged equivalent GOLD returned approximately +58%. The 19-percentage-point gap is entirely explained by the AUD's fall — hedging converts the USD gold price gain directly into AUD, while unhedged gold (priced in USD) gets partially diluted when converted back to a falling AUD. Wait — it works the other way: when the AUD falls, unhedged USD assets gain more in AUD terms. But for gold specifically, QAU hedges the USD exposure, meaning it tracks the USD gold price directly without the AUD/USD overlay. The result was that QAU captured the pure USD gold rally (which was +50%+ in USD terms) and delivered it in AUD.

The more dramatic story is MNRS — up +188.5% in a single year, making it one of the best-performing ETFs on the entire ASX. Gold miners provide leveraged exposure to gold prices (operating leverage), and the currency hedging removed the buffer that an unhedged holder would have had. Its 3-year return of +305.5% is extraordinary. The catch: MNRS has a spread of 1.07% — the widest in the entire hedged ETF universe — meaning the cost of entry and exit is high. This is a trader's instrument more than a buy-and-hold investment.

GHLD from Global X is a new hedged gold bullion option at 0.35% — cheaper than QAU's 0.59%. For investors entering the hedged gold trade today, GHLD is worth comparing to QAU. For more on gold ETF options in Australia, see the Gold ETFs Complete Guide.

BNKS at +39.5% reflects the strength of global financial institutions in a higher-rate environment. FOOD at +36.3% is a surprise standout — agricultural commodity prices surged on supply disruptions.

OOO is one of the most expensive ETFs on the ASX at 1.29% MER, and its returns (+4.7% over 1 year) barely justify the cost. It also suffers from contango drag — a structural cost of holding oil futures that constantly erodes returns. It's a short-term tactical instrument, not a long-term holding.

The JPMorgan covered call series (JPHQ, JHPI, JHGA) are new income-focused products that sell call options against equity portfolios to generate enhanced distributions. At 0.40% MER they're reasonably priced. The trade-off: in strong bull markets, the covered calls cap your upside. These are for income-focused investors who want regular distributions rather than maximum capital growth. For a full breakdown of income options, see High Dividend Yield & Income ETFs.

The 2025–26 Story: Why Hedged Dominated

The AUD fell from approximately US$0.68 to US$0.60 through 2025 — a move of around 12%. That doesn't sound dramatic, but it has a multiplicative effect on every international investment.

When the AUD falls 12%, an unhedged international ETF that returned +17% in local currency terms delivers +7% in AUD terms (because converting USD back to AUD costs you). The hedged version delivers the full +17%. That 10-percentage-point gap applied across every unhedged/hedged pair in 2025.

The pattern is consistent. The biggest gaps appeared in Japan (+31 pp) — where the JPY was also weak against the AUD, compounding the hedging effect — and gold miners (+33 pp), where leverage to commodity prices amplified the currency impact.

But this does not mean hedged is always better.

From late 2020 to early 2022, the AUD recovered from US$0.60 to US$0.78 — a 30% move. During that period, every unhedged ETF automatically captured that currency gain on top of share market returns. Hedged investors left that currency gain on the table. Over 2020–2021, unhedged outperformed hedged by similar margins in the other direction.

Over 10–15 year periods, these moves tend to cancel out. The long-run AUD/USD rate has oscillated between 0.55 and 1.10 over 40 years without a clear trend. What hedging really buys you is reduced volatility, not systematically better returns. That matters if you're in retirement, drawing down, or have a short time horizon.

When to Hedge and When Not To

The right answer depends on your situation more than anything else.

The 50/50 approach (half VGAD/HGBL and half VGS/BGBL) is the pragmatic default for investors who don't have strong views on the AUD direction. You'll never get the full upside of the right call, but you'll never take the full downside of the wrong one either.

For retirees and SMSF investors in pension phase, the case for hedging is stronger. The ability to predict your income stream — rather than watching distributions fluctuate with the AUD — has real value. See Best ETFs for Australian Retirees and Best ETFs for Your SMSF for more on portfolio construction for different life stages.

For a comprehensive treatment of the hedging decision, see Hedged vs Unhedged ETFs: When to Use Each and the Hidden Cost of Getting It Wrong.

Key Takeaways

1. 71 hedged ETFs, $39B AUM — far more than most investors realise. The hedged universe now covers every major asset class.

2. Hedged crushed unhedged in 2025 by 10–33 percentage points across every category, driven by the AUD's ~12% fall against the USD. This is the largest single-year hedging premium in recent ASX history.

3. HGBL at 0.11% is the cheapest hedged global equity ETF — undercutting the incumbent VGAD by 10 basis points. For new investors, the cost argument for HGBL is compelling. GLIN at 0.15% is the cheapest hedged infrastructure option.

4. VGAD at $6.4B is the most popular hedged ETF by a wide margin. VBND at $4.0B is the most popular hedged bond ETF.

5. All global bond ETFs should be hedged. This is not a close debate. Currency volatility is 3–5x larger than bond yields in any given year. An unhedged bond ETF is a currency speculation, not a bond investment.

6. For equities, the right answer is "it depends." A 50/50 split between hedged and unhedged is a reasonable default. Over the very long term, neither has a clear structural edge.

7. LEND at -16.3% is a reminder that hedging protects you from currency risk, not from bad underlying investments. Choosing the wrong asset still costs you.

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Sources: ReviewETF.com.au ETF Data · Hedged vs Unhedged ETFs · Active vs Passive ETFs · Best ETFs for Retirees · Best ETFs for SMSF · Gold ETFs Guide · High Dividend Yield & Income ETFs