Market Trends and Backgrounds
The current development in the ETF market shows a clear shift in investor preferences: German stocks are in demand worldwide, while US stocks are losing attractiveness. This trend is reflected in the capital flows and the demand for European, particularly German ETFs.
Rising Demand for German Stock ETFs
DAX ETFs, which were long overshadowed, are now internationally sought after. Other European stocks are also benefiting from this trend. Examples of popular products include the DAX trackers from iShares (DE0005933931) and Xtrackers (LU0274211480) as well as Euro Stoxx 50 ETFs from iShares (IE00B53L3W79) and Amundi (LU1681047236).
Decline in Interest in US Stocks
The trend continues towards European – including German – stocks and away from US stocks, although this effect is currently somewhat less pronounced than it was some time ago.
Focus on the Defense Sector
Defense ETFs remain bestsellers on the market.
Causes for the Increase
Political Uncertainties in the USA
The new tariff threat from the US President caused a short-term setback, but the German market is recovering quickly. The DAX reaches new highs.
German Economic Policy
A change in debt policy could represent a turning point for Europe. Billions of euros in government spending are set to boost the shrinking German economy – particularly the manufacturing sector benefits from this. The first quarter of 2025 ended with an increase of 11.45% in the German stock market. However, it remains to be seen how political decisions will impact in the long term.
Importance for Private Investors
This development offers several important insights for private investors and savers:
- Diversification is worthwhile: The rising demand for German stocks demonstrates the potential of European markets.
- Actively Managed ETFs Gain Importance: In addition to classic index trackers, actively managed ETFs are becoming increasingly popular; they recorded inflows of around $17 billion in 2024.
- ESG Criteria Are Becoming More Important: ESG-compliant ETFs are also gaining growing support from investors worldwide.
- Exercise Caution with Short-term Trends: Despite positive signals, investors should not focus solely on past performance; political uncertainties can lead to new spikes in volatility at any time.
Conclusion
The increasing international demand for German stocks in ETFs signals strong confidence in the economic recovery of Germany and Europe. For private investors, this offers interesting opportunities to diversify their portfolios – however, the risk of political uncertainties should always be considered.