How do Aus equities really stack up?
Australian equities in the Australian Core Strategies (ACS) universe are second-place, sitting just behind North America when compared to their geographical peers, data from FE Analytics shows.
Money Management looked at the Australia, Asia Pacific ex Japan, Asia Pacific Single Country, Europe and North America equity sectors, and found that our local equity market stacks up well.
Sitting in second place, the Australian sector has returned 8.48 per cent for the past three years to date, and 12.95 per cent in the year to date.
The front-runner, the ACS Equity – North America sector, rolled in returns of 13.55 per cent across three years and 20.69 per cent across the year to date.
The Asia Pacific ex Japan sector sat close behind Australia, while European equities and Asia Pacific Single Country lagged in fourth and fifth position, suggesting that the best opportunities for investors are on home turf.
The chart below shows the performance of the five equity sectors across the three years to date.
Across three years, the top performing fund in the top performing North American equities sector was BetaShares’ NASDAQ 100 ETF, which returned 18.54 per cent for the three years to date, while BetaShares’ Geared US Equity Fund returned 31.91 per cent for the year to date.
The top performing fund in the Australian equities sector across the past three years to date was the Bennelong Concentrated Australian Equity fund, which returned 22.14 per cent, while the year to date saw BlackRock’s Concentrated Total Return Share fund return 32.96 per cent.
Bennelong’s FE five-Crown rated fund invests primarily in consumer products, which are awarded a 48.34 per cent weighting, with health care and basic materials the second largest investments at 20.12 and 17.44 per cent respectively.
The indices of the top two equity sectors have also seen North America fare better, with the S&P 500 outperforming the S&P ASX 200 by 3.54 per cent for the three years to date, and 6.52 per cent for the year to date.
The chart below shows the performance of the indices over the past three years to date.
This performance suggests some funds geared to North American equities may suit a global portfolio, given the average performance of the sector and the index.
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