SNAPSHOT2 min read

The stocks that eclipsed the FAANGs

US shares – particularly the FAANGs - have made all the headlines, but the majority of the world’s best performing stocks over the last five years have actually come from outside the US.

27/08/2020
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Authors

Duncan Lamont, CFA
Head of Strategic Research, Schroders

All of the most exciting developed market companies to invest in are located in the US, right? Think again.

Yes, the US stock market has powered ahead…

In terms of performance, the US stock market has dominated the global landscape for years.

It has returned 73% in the five years to 31 July 2020 (in dollar terms), leaving all but the small New Zealand market (which only includes seven stocks) in its wake.

US_mkt_ahead_of_competition

…but most of the top performing companies have been located outside of the US

Companies such as the FAANGs – Facebook, Apple, Amazon, Netflix, and Google – make all of the headlines.

But, investors may be surprised to learn that, over the past five years, seven of the top ten performing developed market stocks in the MSCI World index and 16 of the top 25 (in dollar terms) have been located outside of the US.

Canada, Japan, New Zealand, Sweden Australia, Germany and Denmark all feature. They span sectors as diverse as milk production, mining, and, of course, technology.

16_of_25_dev_mkt_stocks_not_in_US

Particularly noteworthy is that, despite the fact that Japanese stocks in aggregate have underperformed their US counterparts by 55% over the past five years, four of the top 25 performing stocks are Japanese.

So, while international markets have lagged the US and US companies may make most of the headlines, investors should ignore international stocks at their peril.

To do so could mean missing out on some of the best performing companies in the world.

Issued in the Channel Islands by Cazenove Capital which is part of the Schroders Group and is a trading name of Schroders (C.I.) Limited, licensed and regulated by the Guernsey Financial Services Commission for banking and investment business; and regulated by the Jersey Financial Services Commission. Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested. This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements. All data contained within this document is sourced from Cazenove Capital unless otherwise stated.

 

Authors

Duncan Lamont, CFA
Head of Strategic Research, Schroders

Topics

Cazenove Capital is a trading name of Schroders (C.I.) Ltd which is licensed under the Banking Supervision (Bailiwick of Guernsey) Law 2020 and the Protection of Investors (Bailiwick of Guernsey) Law 2020, as amended in the conduct of banking and investment business. Registered address at Regency Court, Glategny Esplanade, St. Peter Port, Guernsey GY1 3UF, (No.24546) . Schroders (C.I.) Limited, Jersey Branch is regulated by the Jersey Financial Services Commission in the conduct of investment business. Registered address at IFC1, Esplanade, St Helier, Jersey, JE2 3BX, (No.31076).

The value of your investments and the income received from them can fall as well as rise. You may not get back the amount you invested.