Keeping An Eye On European Funds For Future Re-Entry

Europe will not stay down forever.  The US will not be the clear market of choice forever.  Depressed markets have substantial price recovery potential when their trend reverses from down to up.  Here is a look at some of the potentially more interesting European ETFs and a couple of European mutualf funds.

The fund is not totally inclusive.  Mutual funds are for the most part excluded, in favor of ETFs.  However, active management of a mutual fund may be advantageous.

To make the list a fund must outperform the S&P 500 proxy SPY in at least one of these periods: 10 years, 5 years, 3 years, 1 year or YTD 2012 or 3 months; and the fund must have at least $10 million in assets.

Many funds outperformed over 10 years.  No funds outperformed over 5 years and 3 years.   Some funds outperformed YTD, and more funds outperformed over 3 months.

Here’s the data — except for capture ratios, SPY is included in the data table for contrast.

Figure 1: Rolling Returns and Yield

Figure 2: Calendar Yields

Figure 3: Sharpe Ratio and Capture Ratio Spreads for 1, 3, 5 and 10 Years

Figure 4: Historical Valuation Multiples

Figure 5: Forward Valuation Multiples

 Fund Names and Symbols in Alpha Order By Symbol

WisdomTree Europe SmallCap Dividend DFE
iShares MSCI Poland Investable Mkt Index EPOL
iShares MSCI Sweden Index EWD
iShares MSCI Germany Index EWG
iShares MSCI Belgium Investable Mkt Idx EWK
iShares MSCI Switzerland Index EWL
iShares MSCI Netherlands Invstbl Mkt Idx EWN
iShares MSCI Austria Investable Mkt Idx EWO
iShares MSCI Spain Index EWP
iShares MSCI France Index EWQ
iShares MSCI United Kingdom Index EWU
iShares MSCI EMU Index EZU
First Trust STOXX Euro Select Div Idx FDD
Fidelity Europe FIEUX
Fidelity Nordic FNORX
iShares S&P Europe 350 Index IEV
Global X Norway ETF NORW
Market Vectors Poland ETF PLND
Market Vectors Russia ETF RSX
T. Rowe Price Emerging Europe Fund TREMX
Vanguard MSCI Europe ETF VGK

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