In order to spread the risk in the portfolio, it is helpful to look at the overlapping of indices and their statistical correlation.
(Photo: AP)
Frankfurt The markets are nervous: The US Federal Reserve (Fed) is getting serious about the turnaround in interest rates and is putting pressure on share prices worldwide. However, most experts still advise investors to make shares the core of their portfolio. The only important thing is to spread the risks as widely as possible within the equity component.
One way to spread risk is to bet on entire indices. However, these must also be combined accordingly.
A popular index is the MSCI World, which includes 1600 stocks from 23 developed countries. It is easily replicated by exchange traded funds (ETFs). According to the website justetf.com, examples with relatively favorable total expense ratios of 0.12 percent per year come from Lyxor (ISIN LU1781541179) and under the SPDR brand from State Street (ISIN IE00BFY0GT14).
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