During an interview last week, Blackrock (BLK) CEO Larry Fink was quoted as seeing tremendous demand from European investors.
Specifically, Fink said the following: “what is not fully understood by the investment community, and that is the substantial growth in mutual fund sales in Europe. As you know, banks continue to deleverage, more and more activities are going onto the capital markets, greater confidence in Europe and the Europe’s future with a huge amount of savings in Europe. And so we’re seeing much greater penetration across the board in European retail.”
With the European Central Bank’s extraordinary easy policy, including the recently unveiled unprecedented negative deposit rates and near-zero interest rates, European investors realize there are few places to generate decent investment returns, hence the rise in taking on a bit of equity risk. It’s been two years since ECB president Mario Draghi vowed to do “whatever it takes” to save the currency. Since that time, stocks in Europe have risen over 50%, with the most beaten-up markets in Greece and Spain up nearly 100%.
How to Gain Exposure
Investors who want to gain exposure on what Blackrock’s CEO
sees continuing may want to keep tabs on these three mutual funds:
Invesco European Growth Fund Class A (AEDAX) are up 77.68% over the last 5 years.
Columbia European Equity Fund Class A (AEXAX) are up 75.5% over the last 5 years.
Invesco European Small Company Fund Class A (ESMAX) are up 86.67% over the last five years.
The Bottom Line
As has been the case for the U.S. markets, low interest rates continue to be a huge catalyst for investors looking to outperform during this current market cycle.