NEW YORK ( TheStreet)- The Canadian dollar briefly reached parity with the U.S. dollar on Tuesday, highlighting the steady run upward that CurrencyShares Canadian Dollar Trust ( FXC) has taken so far this year.

The last time the Canadian dollar, dubbed the loonie, was at equal value with the U.S. dollar was back in July of 2008, after trading there since the end of 2007. That previous occurrence was the first time since the 1970s that the two currencies traded at parity.

FXC, which tracks the progress of the Canadian Dollar against the U.S. dollar, has advanced 4.5% so far in 2010. This progress comes on top of gains of 15.2% for the currency fund in 2009.

The strength of the currency has helped lift the performance of Canadian equities. While the Canadian equity market (S&P/ TSX Composite) trails the U.S. stock market (S&P 500) in local currency, the most popular ETF providing exposure to companies from Canada, iShares MSCI Canada Index Fund ( EWC), is up 7.8% year to date, which puts it ahead of the 6.2% advance in SPDR S&P 500 Index ( SPY).

Spurring the rise in the value of the loonie against the U.S. dollar is also the perception that the Bank of Canada will raise interest rates before the U.S. Federal Reserve.

Canada's economy is also coming out of the recession stronger than the U.S. since its banking sector was less damaged. There were no major collapses of banks in Canada and the government did not need to bail out any institutions.

However, given the serious level of historical resistance in the area of parity between the two currencies, investors may not find much more room for gains by investing in FXC right now.

A better way to play the strength of Canada's economy would be to use EWC. The fund features companies that produce what a world economy in recovery mode will continue to demand. Materials companies make up 19% of the fund and energy companies comprise 25.8%.

Canada is a large trading partner with the U.S. largely due to its proximity and favorable trade policies, so the stronger loonie is unlikely to cause a significant drop in trade.

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