Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/318206 
Year of Publication: 
2025
Citation: 
[Journal:] Journal of International Economics [ISSN:] 1873-0353 [Volume:] 155 [Article No.:] 104056 [Publisher:] Elsevier [Place:] Amsterdam [Year:] 2025 [Pages:] 1-27
Publisher: 
Elsevier, Amsterdam
Abstract: 
Germany is a world champion in exporting capital (“Exportweltmeister”). Few countries have invested larger amounts of savings abroad. However, we show that Germany plays in the third division when it comes to investment performance. We construct a comprehensive new database of foreign investment returns for 13 advanced economies going back to the 1970s. Germany’s foreign returns were 2 to 5 percentage points lower, per year, than those of comparable countries. Germany also earns significantly less within asset classes, especially for equities and FDI. These aggregate results are confirmed when using return data from 50,000 mutual funds worldwide. German investment funds are worse at stock picking and at timing the market than their international peers. This is particularly true for the ”Big 6” German mutual fund companies. German households would have fared much better with a passive investment strategy.
Subjects: 
International Capital Flows
Foreign Assets
Investment Returns
JEL: 
F21
F30
F31
F36
G15
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article
Document Version: 
Published Version

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