I am a bit confused about how to hedge foreign A against its currency exposure.
Let’s say I am a USD investor investing in a EUR Assets.
Alt 1) I go long the EUR Asset, I now also have a long EUR exposure and I hedge this by selling the EUR short forward.
Alt 2) I go short the EUR Asset. My intuitive reasoning is that this is opposite to alternative 1, and I am now short the EUR. But from looking at the example in Reading 17, section 6.1.1 “EXECUTING A HEDGE” it seems to be the case, there they have a short JPY position and hedge it by selling the JPY short.
My question is, do I still have a long EUR exposure even in alternative 2?
Thanks for the help!