European Equity Funds

With the latest ongoing expansion of the European Union we have witnessed top performing European equity funds that primarily tend to invest in European based companies. Since the 1950’s and the first idea of the European Union by Germany, the countries of the Benelux, Italy and France the union has expanded to comprehend most countries on the continent. The latest expansion was the admittance of Romania and Bulgaria in 2007, while Serbia and Croatia are still on the waiting list due more to war crimes problems, since the two countries are economically and socially more stable then Romania and Bulgaria, but are still at the union’s door awaiting admittance. Nevertheless those two countries along with Ukraine, Georgia and Belarus already belong to the common market and are being invested into by the European equity funds. The markets of Eastern Europe and the Mediterranean have overcome the economic crisis and are still holding strong due to large foreign investment and elevated prices of commodities. Nevertheless most European equity funds assets are invested in Scandinavian countries (about 80%) as well as those 80% of assets are invested in European companies. The Europeans tend to invest through European equity funds into companies that show stable growth and/or at least show potential for such growth. Many European equity funds tend to invest into European emerging Eastern European and Mediterranean economies. These markets include Eastern Europe, the Middle East, North Africa and the former Soviet Union. The decision whether the European equity funds are going to invest in a country or not depends on many different factors. First and foremost there are problems of political stability that make the European equity funds hesitate when they are about to invest in a country. The Europeans are known for their revolutions and government shifts, as well as some of the latest dictatorships were precisely in Europe, like the countries of former Yugoslavia and Belarus. European equity funds also take different factors into consideration like the GDP currency rate and general economic stability. As the general climate and ethnic conflict in Europe are being solved and Russia is closer to the union every day, the European equity funds are willing to invest more and more. The fact that Russia has recovered economically and is becoming a solid partner of the EU makes the job even easier for the European equity funds as far as investment is concerned. Namely, Russia does constitute about 40 % of the European continent and has enormous political and economic influence on the countries of Eastern and Central Europe, so a stable Russia definitely guarantees a stable and united European market.