Why German equities are still good value

ON EUROPE

Europe has been back in the headlines in recent months following the uncertain outcome of the Italian election and the banking crisis in Cyprus.

Despite this, we would highlight that German equities have proven to be resilient throughout this period, with the HDAX Index rising by 8.5% in sterling terms year to date to 25 April. This means that the asset class has now returned 21.5% in sterling terms over the last 12 months, which is ahead of the returns generated by both global and emerging equities. Today, we believe that German equities remain attractively valued relative to the rest of Europe, despite recent performance, with superior prospects for both corporate earnings and economic growth. We are encouraged that we co...