Is EAFE investing a safe investment strategy?

You can invest in the EAFE (Europe, Australasia, Far East) markets safe? Pro EAFE think so! The biggest risk to political unrest in the regions. But much of the MSCI EAFE is Europe, which has little political agitation compared with regions such as Indonesia and China. Australia is another country to political instability low. So you want to invest in EAFE and secure their investments. What should be done is the best way? EAFE Pro believes that markets and EAFE test to be sure, investing in iShares MSCI EAFE Index Fund. It has a very low cost ratio of only 0.35%! According to the data sheet of the fund, 841 shares, which (not more than 2.00% of total funds, HSBC is stored).

The ten largest holdings are only 14.13% of total assets of the Fund.

2.00% HSBC HOLDINGS PLC 1.76% BP PLC NESTLE SA-REG 1.71% BANCO SANTANDER SA 1.36% 1.31% TOTAL SA BHP Billiton 1.27% Telefonica SA 1.22% NOVARTIS AG – REG 1 18% VODAFONE GROUP PLC 1.17% ROCHE HOLDING AG-GENUSSCHEIN 1.15%

The performance of this fund is very good. Cumulative to January 31, 2009 is the year, 23.87% versus the S & P 500 24.28%. Because the S & P 500 produced a higher return, you may ask, why not invest in America and investment in an S & P 500 Index Fund and iShares S & P 500 Index Fund (IVV), the ratio costs only 0, 09%. Well, the reason is very simple and is supported by the facts: the EAFE markets are behind the S & P 500 over the last 5 years back and EAFE markets most likely to maintain this trend for years to come. Here are some figures:

S & P 500 Index 1 year -6.91% 3-year -5.43% 5 years 1.02% 10 years -0.15%
Now let us compare with the MSCI EAFE index, followed by the EFA.
MSCI EAFE 1 years 3.23% 3-year -3.60% 5 years 6.07% 10 year 2.55%

The last question you may have is: “If EAFE is about to make such big profits, why not included in this index? Well, the answer is simple: you need a very large and very wise, the Fund is the safety index is intended for purposes of diversification. Thus EAFE Pro extends across several countries and their indexes and individual stocks for the next 100 + Company% return. Read the stories in this blog are ideas, but also the links on this page to find new ideas for your next best investment!

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