When you make an investment in a Mackenzie mutual fund, the fund receives Canadian dollars to be invested. However, many of Mackenzie's mutual funds invest in markets outside of Canada. Most foreign investments are purchased in currencies other than the Canadian dollar. As a result, the value of those investments will be affected by changes in the value of the Canadian dollar relative to foreign currencies.

For example, if the Canadian dollar rises in value relative to another currency, but the price of the investment otherwise remains the same, then the value of the investment will have declined. Similarly, if the Canadian dollar declines in value relative to the foreign currency, then the value of the investment will have increased.

Some of Mackenzie's mutual funds are permitted to use derivative instruments, such as options, futures or forward contracts, in order to reduce the impact that a change in exchange rates may have on the value of an investment. This type of transaction is often called a "hedge".

Some funds have a policy of hedging against exchange rate movements for most or all of their foreign investments, and will generally hedge most of the time. This is often the case with funds where the investment process is primarily focused on individual security selection, and where less emphasis is made regional or country allocation.

Other funds hedge only in circumstances where the fund managers expect exchange rates to change substantially in the near future. This would be true in situations where the fund manager is optimistic for the prospects of an underlying investment such as a stock or bond, but also expects that the foreign currency in which the security is traded to decline.

Some funds do not hedge foreign currencies at all. This is often true for funds that maintain a generally similar regional allocation over longer periods.

> View a list of funds that may hedge their currency exposure

To learn more about currencies, we would encourage you to speak with your financial advisor.