MSCI Europe ETF: Investing in the European market
The MSCI Europe stock index tracks the performance of 435 companies (as of July 31, 2020) from a total of 15 European countries. It thus reflects around 85 percent of the market capitalization of the European industrialized countries. Great Britain has the largest share with 22 percent, followed by France (17 percent) and Switzerland (16 percent).
Companies from the healthcare (16 percent), consumer goods (15 percent) and financial services (14 percent) sectors are most strongly represented. The largest contributors are the giants Nestlé, Roche Holding, Novartis, SAP, ASML, AstraZeneca, LVHM Moet Hennesy, Sanofi, Novo Nordisk and Glaxosmithkline.
With an ETF on the MSCI Europe, you invest in all of these companies in one fell swoop and thus benefit from the performance of the index. There are a total of 13 different MSCI Europe ETFs that have a total expense ratio (TER) of between 0.10 and 0.30 percent pa. Below we explain everything you need to know about the MSCI Europe Index and ETFs in general:
Tip: An MSCI Europe ETF is particularly suitable for a balanced portfolio in combination with the MSCI World ETF. Because in the MSCI World Index, around 63 percent of all shares are in US companies. When the American market weakens, MSCI World investors feel the effects. So if you want to add European stocks to your portfolio, you can do this wonderfully with an ETF on the MSCI Europe.
The MSCI Europe is the European counterpart to the MSCI World Index, which includes over 1,600 companies from 23 countries. In a separate article, we present the best ETFs on the MSCI World Index. However, this guide is about the MSCI Europe Index, the best ETFs on it and the Differences to the STOXX Europe 600 Index as an alternative to the MSCI Europe.