How to invest in EuroStoxx 50

The Euro Stoxx 50 is a stock market index that represents the 50 largest companies in the eurozone in terms of market capitalization. It was created on February 26, 1998, and is mainly composed of German and French companies. 

The criteria for including or eliminating companies from the index are based on the market capitalization of the company and the capital that circulates freely on the stock exchange (free float).

As with other European indices, it is weighted by market capitalization. This means that not all values ​​have the same weight.

Historical Evolution of the Euro Stoxx 50

Since its creation in 1998, the index has barely achieved a total return of 11%, which means barely 0.4% on an annualized basis.

That said, in March 2000, just two years after the creation of the index, the Eurostoxx achieved its best result by climbing above 5,000 points.

invest in EuroStoxx 50

Best ETFs and Indexed Funds Investing in the Euro Stoxx

One of the best products to invest in the Euro Stoxx is, without a doubt, the ETFs, or exchange-traded funds. They are instruments that replicate the behavior of certain indices and, like stocks, are traded on the stock exchange, so they can be contracted directly through a broker.

In addition, to replicate the Eurostoxx, there are also other instruments, such as index funds, that can be contracted from different entities in UK.

Below, we detail some of the most interesting ETFs.

The Best ETFs To Invest In Euro Stoxx

NameISINTER
iShares Core EURO STOXX 50 UCITS ETFIE00084710090.10%
Amundi EURO STOXX 50 UCITS ETF DR – EUR (D)FR00107909800.15%
HSBC EURO STOXX 50 UCITS ETF EURIE00B4K6B0220.05%
Lyxor Core EURO STOXX 50 (DR) UCITS ETF AccLU09085012150.07%
ETF BBVA EURO STOXX 50ES01053210300.20%

iShares Core EURO STOXX 50 UCITS ETF

  • ISIN: IE0008471009
  • Annualized return over 3 years: 4.96%
  • Ongoing charges: 0.10%
  • Assets under management: 3,498.20 million euros.
  • Reference currency: euros.

The ETF aims to replicate the performance of the Eurostoxx. The dividends obtained from the shares that make up the index are distributed among the ETF participants.

Amundi EURO STOXX 50 UCITS ETF DR – EUR (D)

  • ISIN: LU0322250985
  • Annualized return over 3 years: 6.80%
  • Current expenses: 0.15%
  • Assets under management: 592.46 million euros.
  • Reference currency: euro.

The ETF aims to track the Euro Stoxx 50 index and is managed by the French company Amundi. Like the previous one, it also distributes dividends among the participants.

HSBC EURO STOXX 50 UCITS ETF EUR

  • ISIN: IE00B4K6B022
  • Annualized return over 3 years: 5.10%
  • Current expenses: 0.05%
  • Assets under management: 459.72 million euros.
  • Reference currency: euros.

The investment of this ETF aims to track, before commissions and expenses, the Euro Stoxx 50 index.

Lyxor Core EURO STOXX 50 (DR) UCITS ETF Acc

  • ISIN: LU0908501215
  • Annualized return over 3 years: 5.78%
  • Current expenses: 0.07%
  • Assets under management: 155.72 million euros.
  • Reference currency: euro.

The objective of the ETF is to replicate the behavior of the Euro Stoxx 50, minimizing the tracking error between the fund’s liquidation value and the index.

The Best Indexed Funds To Invest In Eurostoxx

NameISINTER
Fidelity Funds – EURO STOXX 50 Fund A-EURLU02619526820.30%
Orange Fund Euro Stoxx 50ES01527710381.10%
Bankinter European Index 50 FIES01147540311.20%
Vanguard European Stock Index FundIE00079876900.12%

Fidelity Funds – EURO STOXX 50 Fund A-EUR

  • ISIN: LU0261952682
  • Annualized return over 3 years: 4.82%
  • Current expenses: 0.30%
  • Assets under management: 36.64 million euros.
  • Reference currency: euros.

To replicate the behaviour is the use of replication methodology. To do this, it will mainly invest in all the values ​​represented in the Dow Jones EURO STOXX 50 Index, using mainly futures on indices.

Charts showing the behavioral scale of the Fideluty funds

ORANGE Fund Euro Stoxx 50

  • ISIN: ES0152771038
  • Current expenses: 0.25%
  • Assets under management: 172.91 million euros.
  • Reference currency: euros.
  • Annualized return over 3 years: 4.03%

This fund is managed by replicating the Euro Stoxx 50, by acquiring the values ​​that make it up in the same proportion as the index, or by using derivatives on it or on the values ​​that make it up. The return will be linked to that of the index, although it will be affected by commissions and additional expenses.

Bankinter European Index 50, FI

  • ISIN: ES0114754031
  • Annualized return over 3 years: 3.19%
  • Current expenses: 1.20%
  • Assets under management: 35.19 million euros.
  • Reference currency: euros.

This indexed fund will try to replicate the behaviour of the index, for which both the physical replication model (shares) and the synthetic replication model (futures and ETFs) will be used. However, the investment will be made mainly through futures.

Chart showing the behaviour of the Bankinter European Index 50

Vanguard European Stock Index Fund

  • ISIN: IE0007987690
  • Annualized return over 3 years: 5.21%
  • Current expenses: 0.12%
  • Assets under management: 278.41 million euros.
  • Reference currency: euros

The fund seeks to replicate the performance of the Euro Stoxx 50 with dividend accumulation, with Vanguard being one of the few managers that can be contracted in Spain that offers exposure to this index.

Conclusions: What Is the Best ETF or Index Fund to Invest In the Euro Stoxx?

As we have seen, there are several options to invest in the Euro Stoxx 50 index and replicate its performance. Both ETFs and indexed funds have similar costs and tracking errors, since they offer similar returns and evolutions.

That said, there are differences in the distribution strategy of dividends from these instruments and how the values ​​that make up the index are replicated. In addition, the type of product also influences the decision to hire it because it has different tax treatment and different commissions. 

That is why, to invest in Eurostoxx, you just have to look for the ETF or index fund that best suits your needs and investment profile.

With that, you’re set to begin investing in the Euro Stoxx 50, the main European index.

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FAQ

Why should I invest in the Euro Stoxx 50 index instead of individual stocks?

Investing in the Euro Stoxx 50 index is great because it spreads your money across lots of different companies and industries. Plus, you get to follow the performance of the biggest and most important European companies, which can give you a good idea of how the whole region is doing.

Can I buy shares of the companies in the Euro Stoxx 50 index directly?

Absolutely! You can buy shares of individual companies in the Euro Stoxx 50 index just like any other stock. They're publicly traded, so you can become a proud owner if you want.

Are there any sector-specific limitations or biases in the Euro Stoxx 50 index that investors should be aware of?

Yes, the Euro Stoxx 50 index is influenced by the sector composition. It may have more exposure to certain sectors like finance or technology, so keep an eye on that if you want a more diversified portfolio.

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