Investing in Canada and currency hedging in the context of a rising loonie.

The topic has been discussed multiple times in many blogs (including mine) and columns, but I can't resist adding my 2 cents to the topic of currency hedging since it's such a hot topic right now. I don't have the theory to prove what I think but here are a few points that summarize my not too scientific view:

• It's worth hedging a significant portion of your portfolio (I'll say 50% if you insist that I pick some number). That can easily be achieved through ETFs like those from iShares Canada (XSP for example). Claymore Canada also has some hedged ETFs. Why not 100%?
  
• Although the currency fluctuations might even out over a long period, the Canadian dollar might be high compared to your foreign investments when you do need your money the most: when you retire. A dramatic rise of the loonie just before you retire could basically derail your retirement plans ...
  
• Everybody knows that the past is not a guarantee for what will happen in the future. Yes the USA and their dollar should come back up, but what if it does not? I'm ready to pay a slightly higher MER to insure against that risk.