Skip to content

International Investing – Germany

August 30, 2013

The world is a big place – there are over 190 countries and 7 billion people in the world, which really boggles the mind if you sit down and think about it. In addition to being an interesting intellectual exercise, this fact can also have broad implications for your investments and your financial future. It is easy to stay focused on U.S. firms, news, and events during the day-to-day grind, but it is always important to be aware of your surroundings – especially when it comes to your investments. With that in mind, this series of articles will focus on countries and investment opportunities outside the United States that you might not usually hear about.

As always, be sure to consult a financial services professional familiar with both the potential investment and your unique financial situation before embarking on any investment program.

Germany

Germany, once dubbed the so-called “sick man” of Europe due to the arduous and often painful process of reintegrating East Germany and West Germany after the fall of the Berlin Wall, has rebounded in spectacular fashion. Widely considered to be the center of growth in Continental Europe, Germany has been the at the center of negotiations regarding the various mechanisms that have been put forward as a way to stabilize the Eurozone economy as a whole. Led by high- quality exports and a highly-developed service sector, the German economy has been one of the few bright spots in Europe since the global recession 2007-2008.

A few of the benefits of investing in Germany are easy to see. Germany is one of the world’s largest economies – ranked in the top 10 in both nominal size and exports, and with this size, comes stability that is favorable towards investment. The highly-educated workforce in Germany is the envy of many countries around the world and is another benefit for foreign investors looking to gain a reasonable return. A highly-developed national infrastructure and logistical framework, as well as a world-class financial system are other benefits that make investing in Germany an attractive option for domestic investors looking to put funds to work overseas.

When looking at investing in Germany, there are two primary ways to go about it – ADRs or direct purchases. An ADR is basically a certificate held by a U.S. banking institution that represents a certain number of shares in the foreign company, and is held by the U.S. institution. This helps to cut down on the administrative fees and other costs that would otherwise be incurred. For more direct exposure, you can also purchase shares directly from German stock exchanges if your broker offers those services to its retail investor base (you and I).

Some of the largest German firms available for the investment via ADR are Deutsche Bank, Deutsche Telekom AG, Siemens AG, BASF SE, and E.ON AG. While most of these are well known, two might not be household names – E .ON is one of the world’s largest energy conglomerates, and Deutsche Telekom is the parent company of T-Mobile (definitely a well known firm in the U.S.)

Obviously, there are a lot of high-quality companies and opportunities to consider if you are thinking about investing in Germany.

As always, I have attached some links with more information
Happy Reading!

http://www.investgermany.com/reasons-invest-germany.asp
http://internationalinvest.about.com/od/globalmarkets101/a/A-Guide-To-Investing-In-Germany.htm
http://www.bloomberg.com/news/2012-07-24/sap-overtakes-siemens-as-germany-s-most-valuable-company.html
http://www.eon.com/en/about-us/profile.html
http://www.telekom.com/company
http://www.gtai.de/GTAI/Navigation/EN/Invest/investment-guide.html

Advertisements

From → Discussions

Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: