Global indices which exclude fossil fuels have outperformed those which include them but this is not the case for Australia.
According to FE Analytics, the MSCI World index returned 110% and the MSCI ACWI returned 109% since inception of the indices on 15 March 2016 to 29 June, 2021, while their ex-fossil fuel counterparts had performed better with returns of 115% and 113% respectively.
However, this was not the case for Australia where the MSCI Australia index returned 74% while its ex-fossil fuel counterpart had returned 65%. It also applied to coal with the MSCI Australia ex Coal index returning 62% over the same period.
The difference was smaller over one year, however, with all three sectors returning 29%.
Looking at the stock exchange, the ASX 200 returned 75% over the same period but the ASX 200 Resources sector returned 164% thanks to the performance of major ASX stocks such as Woodside Petroleum, Oil Search, Santos, and Whitehaven Coal.
The best performer of these stocks was Whitehaven Coal which returned 265% followed by Santos which returned 95%.
