The upward trend that is driving the main financial centers does not seem to be slowing down. However, in recent weeks, investors have shown some signs of nervousness against the backdrop of uncertainties regarding monetary policy. If the markets are delighted with Donald Trump’s return to business, his program could nevertheless have inflationary effects. The latest indicators on inflation and employment in the United States have eased the atmosphere but only gray areas remain. In particular, Donald Trump remains evasive on some of his priorities, such as the customs measures he is considering with regard to the European Union. While the valuation of the main indices reaches high multiples, it is therefore appropriate to remain cautious because the future is not necessarily a smooth road.
ETF retenu : Xtrackers MSCI World Minimum Volatility UCITS ETF
What’s in this ETF?
The outstanding amount is distributed among 262 positions, mainly in the United States (65.2%), Japan (10%), Switzerland (5.7%), Canada (3.8%), Germany (2 .7%), in Spain (1.9%) and in France (1.9%).
There are notably companies in the technology (20%), finance (16.7%), health (16.3%), communication (12.2%), consumer goods sectors. discretionary (11.1%), industry (8.7%) and public services (5.7%).
The ten main weightings represent only 14.3% of the outstanding amount. We find there T-Mobile US (1,7%), Motorola Solutions (1.7%), the giant Walmart (1,5%), Cisco Systems (1,4%), Roper Technologies (1.4%), specialists in waste collection and management Waste Management (1,4%), et Republic Services (1.2%), the Swiss laboratory Novartis (1,3%) et Deutsche Telekom (1,3%).
In terms of performance, a long-term investor will see his losses be limited in years when the markets decline. In 2022, the MSCI World index fell by 19.5%. At the same time, the ETF only dropped 9.8%. Similar thing in 2018, when the index dropped 10.4% and the ETF only 2.9%. Obviously, during very positive years, the principle is the same. Stock selection is defensive. For example, in 2023, the MSCI World gained 21.8% while the ETF gained only 7.8%. This product is therefore to be favored during tense or bearish periods.
What are its advantages?
- The ETF is a good hedge during volatile, uncertain and bearish periods in the financial markets.
- The outstanding amount is close to a billion dollars and therefore ensures good liquidity for transactions.
- The investment is highly diversified across a wide range of companies from developed countries. For the record, it is an ETF with physical replication, which means that investment in companies is done directly (purchases and sales of shares), which is opposed to the synthetic replication model which involves hold a substitute basket.
- Ongoing charges are relatively low, 0.25%.
The ETF identity card:
-Outstanding: $900 million
Name of positions: 262
Code ISIN : IE00BL25JN58
Ticker: XDEB
PEA eligibility: no, but for the securities account
Fee: 0.25%
To go further: Our convictions for 2025!
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