The financial crisis of 2008/2009 led to a global economic recession. While unconventional monetary policy measures allowed the U.S. to recover from a recession, the debt crisis in Greece meant that the euro area economy continued to contract.
The European Central Bank (ECB), like its counterpart in the U.S., finally introduced measures to fight deflation and put the euro area economy on path to recovery. The measures are finally starting to show results. According to data released last week, the euro area’s GDP hit $2.8 trillion in the first quarter of 2016, going past the previous peak reached in the first quarter of 2008.
With the euro and European economy recovering, investors should consider investing in high quality European assets. Canadian investors can consider the BMO MSCI Europe High Quality Hedged to CAD Index (TSX: ZEQ).
The ETF seeks to replicate the performance of the MSCI Europe Quality 100% Hedged to CAD Index. The fund’s top holdings include British American Tobacco Plc, Novo Nordisk A/S, Nestle SA, Roche Holding AG, and Unilever NV. Year-to-date, the ETF has fallen more than 4%. ZEQ currently offers a yield of 2.15%.
