Germany’s Dax 30 stock index turns 30

Germany’s benchmark stockmarket index, the Dax 30, has risen tenfold since it began life 30 years ago.

Germany's benchmark stockmarket index, the Dax 30, is celebrating its 30th birthday this year. The blue-chip index currently stands at around 12,500, which means it has risen tenfold over the last three decades. By contrast, the Dax's British counterpart, the FTSE 100, is up by a factor of four. Nonetheless, this isn't a fair comparison.

The Dax's return is "an illusion", says Christof Schrmann in WirtschaftsWoche. Unlike the FTSE 100, the Dax is a total return index. It measures the performance of its 30 constituent companies assuming that all dividends are reinvested. A price index such as the FTSE 100 only tracks price movements; it captures capital gains but not income.

Nor is the index a snapshot of the German economy. Many major developed markets' indices comprise big blue chips that make most of their sales abroad, but the Dax is particularly globally orientated.

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The index's fortunes reflect Germany's reliance on exports. More than 80% of the Dax constituents' sales are made beyond Germany's borders. And the exports of goods and services amount to 47.2% of Germany's GDP, according to the World Bank. This makes the index a highly geared play on global growth and especially prone to volatility as trade tensions between the US, China and the EU continue to build. Concern over the slowdown in the eurozone economy will continue to buffet it, too.

Marina has a PhD in globalisation and the media from the London School of Economics, where she worked as a teaching assistant on the MSc Global Media. In 2014 she was invited to be a visiting scholar at Columbia University's sociology department in New York.

She has written for the Economists’ Intelligent Life magazine, the Financial Times, the Times Literary Supplement, and Standpoint magazine in the UK; the New York Observer in the US; and die Bild and Frankfurter Rundschau in Germany. She is trilingual and lives in London. She writes features and is the markets editor at MoneyWeek..