Index Market Analysis Report

Comparative Analysis of Asian and European Markets

S.Matsumoto

2024-10-28

Introduction

This analysis explores investment opportunities across Asian and European markets, focusing on:

  1. Identifying stable markets for consistent profits
  2. Finding high-return countries for growth investment
  3. Determining markets to avoid
  4. Comparing investment attractiveness between Asia and Europe

Executive Summary

Our analysis reveals several key insights:

  • Most stable markets: India, Indonesia, and Singapore
  • Highest returning markets: India, Indonesia, and Germany
  • Markets to avoid: Italy, Spain, and France
  • Regional comparison: Asian markets show higher returns with higher volatility, while European markets (Germany, Netherlands) demonstrate more consistent performance

1. Market Stability Analysis

Market Stability Metrics

Top Markets by Stability Metrics
Country Mean Return Std Dev Sharpe Ratio % Positive Years
India 17.77% 25.51% 0.697 85.7%
Indonesia 10.16% 15.01% 0.677 77.8%
Singapore 5.87% 9.63% 0.610 55.6%
Germany 10.08% 18.76% 0.537 81.2%
Taiwan 7.48% 18.91% 0.396 66.7%
South Korea 7.68% 19.55% 0.393 64.3%

Sharp Return

Higher values are better: A higher Sharpe ratio indicates better risk-adjusted performance

Sharpe ratio < 1.0: Poor risk-adjusted return
Sharpe ratio 1.0-2.0 Acceptable to good risk-adjusted return
Sharpe ratio > 2.0: Excellent risk-adjusted return

Risk-Return Analysis

Market Consistency

2. High-Return Markets Analysis

Top Performing Markets

Annual Returns of Top Performers

3. Markets to Avoid

Poor Risk-Adjusted Returns

Market Evaluation Framework

4. Regional Comparison: Asia vs. Europe

Performance Comparison: Asia vs. Europe

Performance Comparison: Asia vs. Europe
Region Mean Return Median Return Std Dev Sharpe Ratio % Positive Years % Outperformance
Asia8 7.79% 6.03% 24.06% 0.324 64.1% 47.8%
Euro7 3.64% 6.24% 18.09% 0.201 64.3% 48.0%

Regional Returns Over Time

Outperformance Analysis

Return vs Outperformance

Performance Heatmap

Return Distribution by Region

Market Correlations

Crisis Performance

Risk-Return Efficiency

Conclusion

Most Stable Markets

Most Stable Markets for Consistent Profits
Country Mean Return Std Dev CoV Sharpe Ratio % Positive Years
India 17.77% 25.51% 1.44 0.697 85.7%
Indonesia 10.16% 15.01% 1.48 0.677 77.8%
Singapore 5.87% 9.63% 1.64 0.610 55.6%
Germany 10.08% 18.76% 1.86 0.537 81.2%
Taiwan 7.48% 18.91% 2.53 0.396 66.7%

Highest Return Markets

Highest Return Markets
Country Mean Return Std Dev Sharpe Ratio % Positive Years
India 17.77% 25.51% 0.697 85.7%
Indonesia 10.16% 15.01% 0.677 77.8%
Germany 10.08% 18.76% 0.537 81.2%
China 7.91% 43.70% 0.181 56.2%
South Korea 7.68% 19.55% 0.393 64.3%

Markets to Avoid

Markets to Avoid
Country Mean Return Std Dev Sharpe Ratio % Positive Years
Italy 0.33% 19.55% 0.017 50.0%
Spain 0.60% 19.92% 0.030 46.7%
France 1.78% 17.51% 0.102 56.2%
China 7.91% 43.70% 0.181 56.2%
The Netherlands 4.93% 20.45% 0.241 75.0%

Regional Attractiveness

Attractiveness by Region
Region Mean Return Median Return Std Dev Sharpe Ratio % Positive Years % Outperformance
Asia8 7.79% 6.03% 24.06% 0.324 64.1% 47.8%
Euro7 3.64% 6.24% 18.09% 0.201 64.3% 48.0%

Investment Recommendations

Based on our comprehensive analysis, we recommend:

For stable returns: Focus on India, Indonesia, and Singapore

Best combination of stability and consistent profits

For growth investors: Consider India, Indonesia, and Germany

Highest average returns with acceptable risk profiles

Markets to avoid: Italy, Spain, and France

Poor risk-adjusted returns and inconsistent performance

Regional allocation

  • Asia: Higher returns with greater volatility (growth-oriented investors)
  • Europe: More consistent performance (conservative investors)

Optimal Portfolio Strategy

Recommended Allocation

  • Core (50%): India, Indonesia, Singapore
  • Growth (30%): Add Germany
  • Diversification (20%): Select Netherlands Avoid: Italy, Spain, France

Note

This is a conceptual portfolio allocation based on the findings. Actual allocations should be customized based on investor risk profile and investment goals.

Thank You