The selective index of Spanish equities, the Ibex 35, is one of the worst performers this year, which is about to end. In this sense, it should be noted that the Ibex 35 it has appreciated in this period by around 9% in so far this year. A return that cannot be neglected in the face of the very complex exercise that equity markets have experienced this year. That has been, on the other hand, very positive for world stock markets that have accumulated revaluations above 10% and in some cases they have even reached 20%.
In this general context, it must be emphasized that some stock markets on the old continent have accumulated very notable profits. This is the specific case of the Russia Stock Exchange which has experienced a rise of 40%, although in this case due to the increase in the price of crude oil as it is a financial market closely linked to this financial asset of special relevance. While the equity markets of the first order have moved with growth in these markets ranging from 10% to 15%. In other words, higher than that shown by the selective index of Spanish equities.
While on the contrary, only the stock exchanges of Portugal and some Eastern European countries have had a worse performance than the Ibex 35. In some cases with a growth of only a few percentage points and that serves to value and analyze the paper of our equity market. In any case, the national stock market has been penalized in recent months by the lack of government and the uncertainty that has been created with the calling of the new general elections. To explain the behavior of domestic markets in this analyzed period.
The Ibex over 9.000 points
The important thing at the moment is that the selective index of Spanish equities, the Ibex 35, remains above the important level of 9.000 points. This means in practice that you have not yet entered a downtrend, although there is no doubt that he is constantly flirting with her. It cannot be forgotten that at times it has traded below these price levels. To the point of driving a good number of small and medium investors out of the equity markets.
On the other hand, it must be stressed that the Spanish stock market has been more penalized than the rest for a series of reasons that have to do with the world of politics and that therefore have penalized its evolution up to now. In this sense, it must be emphasized that the General Council of Economists (CGE) estimate that the internal uncertainty due to the lack of government in Spain is subtracting from economic growth up to three tenths. While the national stock market is trading between 9.000 and 9.400 points since last June.
Lower rise than the European
In any case, there is one thing that is evident and that is that the rest of the European stock exchanges maintain more satisfactory intermediation margins for the interests of small and medium investors and almost throughout the stock market year. With the exception of some very specific sectors, such as electricity, which is closely linked to the evolution of the Ibex 35. In this sense, it must be remembered that even five companies are listed in the selective index of Spanish equities, more than in other places of great relevance in the old continent.
While on the other hand, this has been a constant that has happened in the last five years and except for some small periods of time as an exception. At the same time, the falls have developed with less intensity than in the European international markets. To the point that you may wonder if it is not better to go to these parks to better make our capital profitable in investment. Where we can improve profit margins between 2% and 5% approximately. In exchange for paying some more demanding commissions and expenses in its management or maintenance, with an additional bonus of around 25%.
Bank dependency
If there is one thing that Spanish equities are characterized by, it is due to their high links with the financial sector and that ultimately leads to losses in the stock index are greater if banks lead depreciations in the sector. This is a scenario that has not happened a few times and that, without a doubt, has weighed down the expectations of small and medium-sized investors who have opted for this European market. And that has also been other of the causes for the Ibex 35 to have had a worse result than in the squares of our closest environment.
Another aspect that must be analyzed in great detail is that which has to do with the greater dependence of Spanish securities on Latin American equity markets, especially Argentina, Brazil and Mexico. This excessive dependence has sometimes led to the selective index of Spanish equities having neglected its most strategic markets on the continent. With some differences that have been very noteworthy by a large part of the financial analysts. To the point that they have been able to reach levels of almost one percentage point in a single session in the stock market. A really excessive margin for countries that belong to the European Union.
20% divergences with the American
But we must not forget the data that tells us that the European and US stock indices accumulate double digit returns, in some cases close to 20%. That is to say, superior to ours and in some cases with quite relevant differences. Although for this it is necessary to formalize a currency exchange in all operations. With expenses that as a whole can reach 2% or 3% on the capital invested in each of the operations on the stock market.
In addition, it is always more comfortable to choose domestic markets and their ease of targeting a wide range of stocks from all stock markets. Where we can formalize operations, not only in its online format but also physically from bank branches or even from a mobile phone. Just as we did until a few years ago.
Opt for the European income
In any case, there cannot always be the resource of going to one of the many indexes that are present in the continent, especially through the Investment funds based on European equities Because in reality they allow the investor to be representing in European equities without being directly exposed in the stock market and, where he does not have to bet on a specific value since he will invest his money in the most representative companies of the euro zone.
Although the main disadvantage is the fact that the holders of this financial product cannot fully collect the hypothetical capital gains that the European stock market may generate. While on the other hand, it must be said that they involve some expenses in its management or maintenance and commissions higher than the investment in the Spanish stock market. And that very specific occasions can rise up to 3%. It is then the time to consider whether retail investors can afford this higher expense when in fact it is not necessary. Each of them will have to give a solution to this small problem that may arise from now on.
Emerging markets: more risks
Another very different thing is investing in emerging markets. Where some managers, not many yet, have launched equity funds that invest in stocks on the stock markets. Brazil, Russia, India and China. They are based on the construction of an investment portfolio of stocks of large capitalization companies in these countries and their main objective is to obtain a profitability based on the possibility of growth of the companies located in those geographical areas, although for a high risk profile. and a medium and long-term investment horizon, between two and five years.
In some cases they have the serious disadvantage that they have to subscribe in dollars instead of euros, but also in other cases the minimum subscription is not too high, between 2.000 and 15.000 dollars, which can make this product suitable. for a large part of households. The best utility of its contracting is that it allows savers to take positions in emerging markets without having to carry out the purchase and sale operations that the parquet floors of their respective countries require, and which undoubtedly represents an additional problem for the financial user. that he is not used to operating in these international markets. A really excessive margin for countries that belong to the European Union and that can choose investment in one direction or another.