The rise in shares of seven US technology companies (Apple, Microsoft, Amazon, Tesla, Meta, Alphabet, Nvidia) accounted for 40%(!) of the entire 22.8% 2023 return of the MSCI All Country World Index , which tracks the global stock market. After a weak 2022, this meant a very good year also for Estonian index pension funds, most of which invested primarily in developed country stock markets. But is it still worth investing in second and third pillar index funds in the future to direct money mainly towards US-listed companies, or the record concentration of individual stocks can hurt you in a bad year and if you now prefer a more geographical investment ? diversified portfolio offered by LHV index funds?
While developed stock markets have grown at 13.6% per year and emerging markets at 4.4% per year over the past 5 years, this has not always been the case. If we look at returns over 20 years since 2001, we see that developed stock markets have grown on average 5.4% per year and emerging markets have grown by 6.8% per year. Should there be more investment in developed or emerging markets in the next 5 years? Especially since average economic growth over the next 5 years is expected to be several percentage points higher in developing markets than in developed ones. Joel Kukemelk, head of LHV index funds and founder of Estonia’s first pension index fund, will help analyze the differences between Estonian pension index funds in the show.
Listen to the show on Soundcloud.
LHV pension funds are managed by AS LHV Varahaldus. Fund share values may rise or fall, and the performance of funds in prior periods is not a promise or indication of performance in subsequent periods. The preservation of the value of the invested amount of the fund is not guaranteed. View the LHV pension fund prospectus and basic information documents at lhv.ee and consult an expert. Find out the average returns of the funds over the last 2, 3 and 5 calendar years.
2024-01-17 11:11:16
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