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FEZ: Eurozone Equities Are Reasonably Priced For Returns Of 8% Or More

Oct. 03, 2021 3:16 AM ETSPDR® EURO STOXX 50 ETF (FEZ) ETF1 Comment
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  • FEZ's valuation would indicate probable under-valuation, as judged by a higher-than-expected equity risk premium.
  • Investors are probably under-weight European equities, and in part this is understandable given lower returns on equity as compared to the United States.
  • Nevertheless, given how low interest rates are regionally, FEZ seems to indicate that Eurozone equities are regionally attractive.
  • All considered, Eurozone equities could potentially benefit from a geographical rotation in equity holdings among global investors.
  • Regardless, in a base case scenario, I would expect returns of at least 8% per year for the next few years at present prices.

Planet Earth At Night - City Lights of Europe Glowing In The Dark

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The SPDR Euro Stoxx 50 ETF (NYSEARCA:NYSEARCA:FEZ) is an exchange-traded fund that enables investors to get exposure to Eurozone stocks. The fund's benchmark index is the well-known EURO STOXX 50 Index, which is designed

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Providing commentary and analysis, principally focused on global macro, foreign exchange, and equities as an asset class. Primary interests include equity investing from an international perspective, and FX fair values.

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Comments (1)

RedRock Asset Management GmbH profile picture
thanks for this article. I do live in Germany and I appreciate your analysis. Plus an average 8% does not disturb me, at all!
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