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Currency ETF Traders Bet on the Euro’s Demise

Europe's finances haven't completely imploded, and in the last couple of weeks, the euro has gained against the dollar. Some bearish currency traders, however, are betting on leveraged-inverse currency exchange traded funds (ETFs) for any shifts in the fortunes of the euro.

Call buyers were focusing on near-term August call options, along with longer-dated September calls, Listen to Our Podcast on Europe ETFs.]

In the last couple of months, the euro has been appreciating as European countries reported stronger economic data. If the situation reverses, the options traders will win out. Recently, the U.K. housing gauge signaled its first drop in prices in a year and France reported weaker industrial production for June. [ Why Euro ETFs Are Under the Weather. ]

European countries have been reassuring the market with budget proposals but the execution of those proposals is far from practical, remarks Macro Man for iStockAnalyst . European bonds are also being dumped, following European Union's agreement to rescue more banks and add to a greater budget deficit. The euro to dollar trend is breaking up, and some observers are wondering if this is the start of a new turn. [ Trends Spotted in Dollar, Yen and Euro ETFs. ]

For more information on the euro, visit our euro category . According to the ETF Analyzer , there are four euro-focused ETFs, so you can play it straight, short or leveraged:

  • ProShares UltraShort Euro (NYSEArca: EUO)
  • ProShares Ultra Euro (NYSEArca: ULE)
  • CurrencyShares Euro Trust (NYSEArca: FXE)
  • Wisdomtree Dreyfus Euro ETF (NYSEArca: EU)

Max Chen contributed to this article.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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