Comparison of Profitability: MSCI World ETF versus DAX ETF for Investors

Comparison of Profitability: MSCI World ETF versus DAX ETF for Investors

Let's break down the MSCI World ETF and DAX, Germany's top investment choices, but which one is actually the cash cow?

Sure, they're both popular, but these two indices—the DAX and the MSCI World—are as different as a sprint and a marathon. While the DAX only shuffles around 40 heavyweights in the German stock market, the MSCI World struts a whopping 1,600 companies from 23 industrialized countries. That's a whole lot of cooking pots to stir! With the MSCI World ETF, you're tossing your peanuts into a larger, more diverse salad, spreading the risk across a bigger market.

But how do they measure up in the ring? Let's look at their records. Over a 5-year stretch, the DAX has been hanging out, more or less in the same spot—stagnant as a pond. By November 2022, it finds itself right where it was in November 2017, essentially earning a big fat "0" on its report card. The MSCI World? It's been on a mission, bagging more than 60 percent return in the same timeframe. This contest has a clear champion!

And as you look back over the past decade, the MSCI World hasn't missed a beat, gaining a whopping 210 percent profit, while the DAX can only boast "only" 82 percent. Performance? It's clearly on Team MSCI's side. But what does that mean for us today, you ask?

Which MSCI World investments are worth a shot?

Since many of the DAX's bigwigs are also present in the MSCI World Index, it seems like a no-brainer—diversify, baby! You've got a bigger playground, more stocks from different countries, and a piece of the German economy, too, as German stocks make about 3% of the index's weight. That's not too shabby!

Now, which MSCI World ETFs are worth hitting up? The iShares Core MSCI World UCITS ETF USD (Acc) is the big kahuna on the global stock index (WKN: A0RPWH), and the Invesco MSCI World UCITS ETF (WKN: A0RGCS) has been the MVP of the last 12 months.

With Europe and Germany facing their own set of challenges, an investment in the MSCI World could be the safest and smartest move for future growth. Let the games—and the money—commence!

Enrichment Data:

Given the current economic difficulties in Germany and Europe, it's essential to assess the performance of the top contenders—the iShares Core MSCI World UCITS ETF USD (Acc) and an equivalent Invesco MSCI World UCITS ETF. However, performance data on the Invesco MSCI World UCITS ETF is hard to come by. Let's focus on the iShares Core MSCI World UCITS ETF then, and compare it to a popular tech-focused ETF—the Invesco QQQ.

Performance and Characteristics of iShares Core MSCI World UCITS ETF

1. Performance: The iShares Core MSCI World UCITS ETF has shown a return of -9.86% year-to-date as of recent data, which pales in comparison to the -18.49% return of the Invesco QQQ ETF. However, over the past five years, the iShares fund has gained 17.31%, which is still stronger than the QQQ ETF's 6.27%.
2. Volatility: It has a lower volatility at 11.22%, suggesting more stability compared to the Invesco QQQ's 16.64%.
3. Expense Ratio: The ETF has an expense ratio of 0.20%, making it a cost-effective option.
4. Index Tracking: It tracks the MSCI World Index, which includes stocks from developed countries worldwide.

Final Thoughts

Due to the current economic challenges in Germany and Europe, the stability and diversification offered by the iShares Core MSCI World UCITS ETF might be appealing to investors. This ETF spreads risk across many developed markets, which can help manage risk. However, since there's little-to-no specific information available on the Invesco MSCI World UCITS ETF, a direct comparison is not possible. For future suitability, you should consider the iShares Core MSCI World UCITS ETF's diversification, stability, and expense ratio when deciding which ETF to invest in.

1. Considering the current economic challenges in Germany and Europe, the iShares Core MSCI World UCITS ETF has been a popular choice among investors due to its diversification and stability.
2. Compared to a tech-focused ETF like the Invesco QQQ, the iShares Core MSCI World UCITS ETF has shown a lower volatility of 11.22%, suggesting more stability.
3. Over the past five years, the iShares Core MSCI World UCITS ETF has gained a significant 17.31%, which is stronger than the QQQ ETF's 6.27%.
4. For cost-effective investing, the iShares Core MSCI World UCITS ETF comes with an expense ratio of 0.20%.

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