Including reinvested dividends, European stocks have returned around 4% per annum since 1999, in dollar terms. Lagging the return on US stocks over the same period certainly but hardly "dire".
You can express performance in whatever currency you want - as long as you are consistent in making comparisons.surely the performance of the euro stoxx 600 should be expressed in euros not dollars
I'm astounded that, although bond yields are at record lows, more money went into bond ETF's (Exchange Traded Funds) in the first 10 months of 2019 than into their equity counterparts ($191 billion v $158 billion for equity ETF's). Why do private investors keep shovelling money into bonds?
The article doesn't state whether they're gross or net. The implication is that they're net. It seems that one of the key drivers for the growth in bond ETF's is that investors (and I think this includes institutions, not just private investors as I had assumed initially) are finding that constructing and running fixed income strategies with individual bonds is more expensive and less efficient than in the past because of regulatory reforms. Post-crisis reforms have caused banks and broker dealers to hold lower inventories of bonds, which reduces liquidity. ETF's (supposedly) improve the liquidity position. I'm not sure that would be true in a crisis, but that's a question for another day.Are they Net figures or simply inflows??
All the dividends have done is compensated for the loss due to inflation, in absolute terms you are just about getting back the money you invested in 1999 if you stayed invested through all the turmoil of the last 2 decades and the financial crash.
I'm astounded that, although bond yields are at record lows, more money went into bond ETF's (Exchange Traded Funds) in the first 10 months of 2019 than into their equity counterparts ($191 billion v $158 billion for equity ETF's). Why do private investors keep shovelling money into bonds?
Without knowing the aim / strategy of the investors it's difficult to answer this. But I can think of two drivers; (a) an alternative to cash especially where negative rates are in place and (b) matching returns versus liabilities.
On the second point, I know trustees of DB schemes where, due to the ageing population in the DB schemes generally, are at a point where asset growth is no longer the driving force. They are now managing to "liability matching" i.e. just ensuring the portfolio is paying out to the scheme members.
These might drive bond / FI ETF demand
But only in dollars and only because the euro was at its lowest level ever against the dollar after its launch reaching a low of 0.9 euros to the dollar in 2000, it'd now at 1.1 dollars to the euro , surely the performance of the euro stoxx 600 should be expressed in euros not dollars. In any case we live in Europe not the US so why the fixation on the performance of the S and P 500. All the dividends have done is compensated for the loss due to inflation, in absolute terms you are just about getting back the money you invested in 1999 if you stayed invested through all the turmoil of the last 2 decades and the financial crash.
Just when it looked like the euro stoxx 600 might finally push past its year 1999 peak trump sends it crashing back down again with renewed threats of sanctions.
I dont know but from memory it was around 3 or 4000 points , its now at almost 7000 points after a very good recovery this year. It reached its all time high in 2007 of around 10,400 points and then a catastrophic fall to 2000 points in 2009 following the banking and property crash, so it has been very volatile over the last 2 decades more like an emerging market economy.Out of curiosity, where was the ISEQ in 1999?
I dont know but from memory it was around 3 or 4000 points , its now at almost 7000 points after a very good recovery this year. It reached its all time high in 2007 of around 10,400 points and then a catastrophic fall to 2000 points in 2009 following the banking and property crash, so it has been very volatile over the last 2 decades more like an emerging market economy.
It wasn't really badly hit in 2001 after the dot com crash because it was fairly light on technology stocks (although it had baltimore technologies and riverdeep then) , today I dont think there are any technology stocks in the iseq even if we have a "silicon docks"
@galway_blow_in I would much prefer to have been an investor in the eurostoxx 600 back in 2000 than the iseq, as bad an all as it performed it did not have that catastropic collapse in 2009 that the irish market experienced. Alot of irish people were wiped out by that collapse , even recently look at the effect of brexit on the iseq it had a much bigger impact than it did on the ftse.
bank of ireland is up more than 50% in the past four months , the banks had been massively shorted off the back of brexit fears .
yes i actually bought bank of ireland a year ago, so i experienced that big drop, its basically back where it was a year ago, thankfully the shorters can make big mistakes aswell. Of course the banks were in a completely different position in 2008 so the shorters were correct then, they get used to kicking the same old kicking boys. I remember after the technology crash in 2001 it took a full decade before the big tech stocks like microsoft and oracle became respectable again, they were still ridiculously cheap in 2011, microsoft has increased 5 fold since then and the dot com crash is long forgotten.
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