The broader U.S. market is trading at a nail-biting price-to-sales (P/S) ratio level of 1.6. In the sixty year period between 1940 and 2000, P/S ratios typically traded between 0.50 and 1.50; rare was the case when the ratio between stock price and revenue moved much higher. On the flip side, WisdomTree’s Hedged German Equity Fund (DXGE) offers exposure to some of the most heralded German brands (e.g., Daimler, Siemens, Bayer, Allianz, etc.) with a combined price-to-sales of just 0.60. And for those who are worried about currency fluctuations, DXGE hedges against fluctuations between the value of the greenback and the euro. If you believe that German equities will benefit from European Central Bank rate cuts and stimulus — if you believe that German stocks may have the most potential upside for the region — then DXGE may be the means by which the early bird gets its worm.
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