Friday, March 13, 2015

Extra investment March 2015: ETF Austria


Deutsche Bank, the issuer of my ETF Austria fund

I am now moving further with the ETF strategy and I decided to buy an Austrian index fund. There were three offered to me. All of them had fees around 0.3%. One belonged to Blackrock and paid out dividends, one belonged to Commerzbank and the third one belongs to Deutsche Bank.

After deciding that I do not care about dividends I then could pick either of the two funds since I am a shareholder in both companies so no matter what the fees I paid would come back to myself (hopefully!) but the Commerzbank one had total fees of 0.3% and Deutsche Bank had 0.25% so in the end it became Deutsche Bank.

The Austrian index is today almost as pushed down as it was around the start of the financial crisis. The reason for this is two fold.

1. Their biggest market cap company is a bank. Just like here in Germany the investors have still not regained the trust in the banks (and it is also correct of them) which has made sure to keep the index low.
2. The second biggest market cap company is an oil and gas company (in a close race with a machine/plant engineering company). Since a long time that entire industry has had a low valuation and since last autumn many of them were pushed down one step further.

Austria being part of the the German speaking countries have a similar efficiency please see Working population in various countries for some graphs. I have therefore no fear for that Austria will recover, they will and then I now will have a small part of that recovery.

The latest news that they allowed a bank to go bust I also find to be excellent news since the banks will be forced to shape up their business if they want to remain.

So I bought 30 parts in ETF Austria (ISIN LU0659579063 | WKN DBX0KJ) at a total cost of 1,113 € including fees or 37.09 € per part.

To take a look at my current Stock Portfolio then please click on that link. The portfolio will however not be fully updated until the end of the month.

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