Trumps Big Beautiful Bill will weaken the S&P 500 for non-US investors!

Trump's Big Beautiful Bill is expected to weaken the dollar even more as it will increase the USA debt level and weaken US bonds.

During the last 6 months the EUROUSD rate has gone from 1.02 to 1.13 and has been predicted to reach 1.2 in the next 6 months (see chart below).

For UK/EURO investors, the dollar exchange rate has caused a 9% hit on the S&P 500.

We can see from the table below that buying a hedged S&P 500 UCITS, even though it has a higher TER (0.2% vs. 0.07) would have shown a much better return (CSP1 vs. IUSE - see below).

Tech stocks should improve with Trumps BBB because it gives enormous tax breaks to companies buying capital investments and R&D expenses which should give a boost to both large and small Tech companies amongst others, but the dollar exchange rate will also take it's toll on any share price rise for UK/EURO investors. IUSE is a Euro-based fund and there will still be an Fx rate, so I will buy the G500 £-based Ireland fund instead.

If you want to be more cautious, perhaps invest in a hedged All World fund (e.g. Euro IWDE or GBP IGWD) instead of the S&P 500, but beware of the much higher TER charge rate due to the large number of funds and currency complexity involved in a hedged world fund (e.g. 0.5% instead of 0.2%).

The GBP Hedged IGWD MSCI World fund has beaten SWDA over most periods for UK investors!

That is why I am now looking at buying more of a Hedged S&P 500 fund like G500 instead of CSPX or CSP1 over the next 6 months. The buying power of GBP will improve but I see US growth beating UK\EU growth next year.

This is not financial advice, please do you own research.