Germany has managed one of the most impressive responses to the COVID-19 pandemic. In response to this success, Germany has begun the gradual process of reopening its economy. Chancellor Angela Merkel has allowed small stores to open after April 19. Some premiers and industrial leaders are pressuring the federal government to move more quickly in order to prevent further economic damage.
As the largest economy in Europe, it is a good sign that Germany has managed to perform well in the face of this crisis. Analysts and economists are expecting a sharp snapback in activity as the lockdowns subsist. On its current track, Germany may be one of the first Western countries to experience a bounce back.
With this in mind, investors may want to consider the iShares MSCI Germany ETF (NYSE:EWG). Shares of the ETF have dropped 22% in 2020 as of close on April 20. This came after a 20% increase in 2019. The ETF seeks to track the investment results of an index composed of German equities.
Some of the top holdings in the ETF include the Information Technology giant SAP, the industrial giant Siemens, and the health care titan Bayer. The heaviest weighted sectors are consumer discretionary, financials, and information technology at roughly 15% apiece. Health care and industrials rounds out the top five at over 10%.
The ETF is trading near a 52-week low. Germany is set to release more of what are certain to be some grim economic reports, but investors should focus on the positives of the reopening. Now is a good time to buy-low in this ETF.
