Study "Trendmonitor Asset Allocation 2024": Germany is losing the trust of its own investors as German capital is migrating abroad
Reading the business press and social networks in 2024, one impression comes to mind: The German economy seems to be on the decline. Is Germany among the biggest losers in the global competition between business locations?
Time for facts! More precisely: for the broadest data-supported analysis of the investment behavior of independent German #assetmanagers. How do Germans invest? QPLIX | Wealth Management Software has investigated this question once again together with?@Institut für Verm?gensaufbau (IVA) based on an anlaysis of more than 62.000 real portfolios. The results are summarised in the study "Trendmonitor Verm?gensverwaltung (#TMVV) 2024". The core finding: Germany loses the trust of its own investors, as German wealth increasingly flees abroad.
The basis of the #TMVV study: a good 62,000 real client portfolios from more than 120 independent asset managers with around 25,000 different securities (including real estate funds, REITs, commodity funds, etc.) and more than 8,000 funds and ETFs. The Trendmonitor Verm?gensverwaltung is by far the broadest and most in-depth study on the question of how professional investors in German-speaking countries invest their clients' assets and how they react to trends, crises and economic opportunities.
What can’t be ignored looking at this huge amount of data: Never before has so little German capital been invested in Germany. North America's dominance, on the other hand, is reflected in a new record of 44.3% in the average German investment portfolio, while the eurozone is just below the 30% threshold in 2023.
Tech first: German assets fuel the “Magnificent Seven”? ?
The extensive portfolio data also shows a remarkable shift in the individual equity asset classes: The share of the so-called “Magnificent Seven” tech companies in the invested individual stocks has more than tripled in the last six years. The performance of these exceptional global tech giants has increased their share of German equity portfolios from 4.1% to 12.5%. However, by the end of 2023, we see the first signs of a bubble forming in this segment, which has also recently shown the first signs of losing momentum.?
There are two exceptions to the overall trend: German equities continue to play an important role in the top 20 stocks due to their reliable and high dividends. And: The new favorite German single stock is European: The Danish pharmaceutical company Novo Nordisk has even overtaken the tech titans in 2023 and is the new favorite single stock of German asset managers.
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Portfolios react like a seismograph not only to long-term economic trends, but also to the immediate effects of short-term trends and crises. The message is clear on one point: Independent German asset managers are voting with their investment behavior and the reputation of their own country as an investment destination has reached an all-time low. In 2023, investments in German companies will account for less than a third of German portfolios for the first time (28.6%), far behind the USA (36%), but also behind the rest of Europe excluding Germany (31%).?????
Another formerly booming region has also lost popularity: with the collapse of supply chains during the coronavirus pandemic, the aggressive stance towards Taiwan and the trade dispute in the automotive industry, the weighting of China within the assets invested in individual equities was continuously reduced. On the subject of China ”De-Risking”, we can say on the basis of the portfolio data: in German portfolios it has already begun.?
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The complete asset allocation study “Trend Monitor Verm?gensverwaltung 2024” contains extensive further analyses on the current composition of German portfolios as well as the development of topics such as equities, bonds, currencies, investment regions, company sizes, credit ratings, ESG and EU taxonomy, cryptocurrencies and many more.
The study TMVV 2024 can be downloaded free of charge at (available in German language only):