Exchange-traded index funds (ETFs) have experienced a boom in recent years and have long been part of the standard equipment of investors. The most widely used index is the MSCI World: In the past twelve months, the world share index has risen by almost 30 percent.
As one of the most important ETFs worldwide, it shows the price development of around 1,600 stocks from 23 industrialized countries. The largest share of the MSCI World, almost two-thirds, is in US stocks – with a greater weighting on US tech stocks: Alphabet, Apple, Microsoft, Amazon, Facebook and Tesla are just a few of the companies that make up the MSCI World are represented.
Is this weighting healthy for a world index? How big is the risk of a bubble? This is what financial editor Andrea Cünnen explains in today’s program. She knows how investors can protect their portfolio from this overweighting.
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