Friday, April 3, 2015

The comparison shows that over the past 11 years the dividend index investment hdpe paid off greatl

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Financial press repeated day and night two recommendations regarding saving: hdpe a. You should start saving at an early age; In a. Young people should hdpe contain a large element of shares intended hdpe for long-term savings. The rationale behind the second recommendation hdpe is long term excess return on stocks relative lag "H (risk premium) to offset the volatility of the stock market. hdpe However, investing hdpe in stocks requires diversified hdpe portfolio both between countries and between hdpe sectors, while young people are usually savings Rabbi in, making it difficult for diversification of the portfolio. address this problem is given by "the ETFs that allow follow global stock index. Using these indices hdpe can be obtained from a very wide dispersion even when the case is small.
US companies account for about half of this measure, while all developed countries (USA, "in, Western hdpe Europe and Japan) hdpe account for about - 80% of it. Israel has two ETFs that follow the index's global hdpe MSCI - Performance management fee of 1% and charm which charges fees management of 0.95% (magic has another ETF that follows another World Index MSCI featuring only the shares of the developed countries).
Another measure that allows to invest in all the world's stock markets is the S & P Global 100 Index, which includes the shares of 100 companies with the largest market capitalization in the world, and can invest through ETF IOO. The geographic distribution of this index is smaller than the MSCI index, and gives a very small representation of emerging markets (less than - 5%).
While ETF ACWI was more volatile than - IOO, the past seven years, but also produced a higher yield. Average annual return of principal ACWI was 5.1%, compared to the corresponding annual return of principal hdpe IOO was 3.5%.
Alternative ETFs after the general global equity index ETF is a global standard that follows biased dividends. Selected oriented metrics stock dividends included in the index by dividend yield rather than at market hdpe value. The economic logic is behind these measures is that the index includes only shares value - ie stocks whose prices are low relative to the economic value (measured in this case through dividend payments). Many studies have shown the world made from indices constructed according to the ratio value (such as dividend yield, earnings multiples, etc.) give higher returns over time than regular stock indices.
Dow Jones Global Select Dividend, which includes 100 shares of the world's largest companies weighted by their dividend yield. Both the ETF collect management fees of 1%, but you can invest in a survey by using the ETF FGD its management fees are only 0.4%. The geographical composition of global dividend index Dow Jones is very different from the composition of the overall global index of MSCI.
The proportion of US companies in the index dividend is about half their weight in the CPI; However the proportion of European companies in the index dividends almost double their weight in the CPI. In addition, the dividend index gives a much higher representation of emerging markets in Asia compared to the normal index.
ETF now possible to invest in the index dividends world is DEW's Wisdom Tree specializes in the indices of the basis of weighted according hdpe to "the dividend yields. The index of Wisdom Tree includes about - 460 companies and the management fees charged by the fund DEW are 0.58%. Geographic distribution of the index dividends of Wisdom Tree wider than the dividend hdpe index and the Dow Jones also provides representation in other emerging markets. With all that weight of US stocks and European stocks is almost the same in both indices.
Four years were not good for equity investors and investment in each stock indices produced negative hdpe returns. But we can see that the two indices dividends lagged behind the general stock index. Average annual return of the MSCI World index past four years was 1.9% - compared with the corresponding annual return of 4.3% - the index of Wisdom Tree dividend and - 5.5% - the index of the Dow Jones dividends. Arrears of dividend indices after the general share index was due to their increased exposure hdpe to the financial and real sectors "very damaged Estate recent economic crisis.
However, when extending the measurement period hdpe completely different picture emerges as seen by comparing the performance of global stock index MSCI World index dividends Dow Jones in the period between 2000-2010 (index of Wisdom hdpe Tree is new and there is no respect for this data).
The comparison shows that over the past 11 years the dividend index investment hdpe paid off greatly. The average annual yield dividends index was 10.6% compared to the corresponding annual return of the CPI was about - 1%. Global stock market suffered in the last decade of the two crises: crisis of 1999-2002 technology stocks and the financial crisis in 2007-2008. But the companies, that make up the index dividends, technology is not affected by the crisis and prices actually increased during the crisis. Despite the expected dividends fell during hdpe the financial crisis than the general index, he still managed to produce hdpe in the past decade a very high return.
Israeli ETFs consistently collect higher management fee index funds overseas counterparts have "to. Furthermore foreign basket hdpe funds are safer because of investors that their money is in trust, while the ETF issuer risk Israeli.
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