RT Journal Article SR Electronic T1 Hedging Currencies with Hindsight and Regret JF The Journal of Investing FD Institutional Investor Journals SP 15 OP 19 DO 10.3905/joi.2005.517170 VO 14 IS 2 A1 Meir Statman YR 2005 UL https://pm-research.com/content/14/2/15.abstract AB Realized returns and risk of hedged and unhedged portfolios during 1988–2003 were virtually identical. Portfolio managers who care about the risk and expected returns of policy portfolios could have chosen to hedge or not to hedge by the toss of a coin. Mean monthly returns (and standard deviations of returns) of unhedged global portfolios were higher than those of hedged ones in half of the 16 years (9 of the 16) and lower in the other half (7). Portfolio managers who are pressed to earn positive alphas while constructing good policy portfolios are likely to do neither right. They often forecast future movements of currencies by extrapolating past movements. Hindsight and regret propel them on a seesaw journey, forever looking for positive alphas but finding negative ones.