How a Strategy Performed on Germany's DAX Index

Germany isn’t just a key player in Europe; it's the continent's economic engine and the fourth-largest economy on the planet. This strength comes from a massive export market and a reputation for top-tier production, especially in high-tech industries. This economic power is reflected in its stock market, the DAX index, which has generally trended upward over the long haul. However, it wasn't a straight line up. The period between 2000 and 2013 was more of a sideways grind, thanks to a series of global and European economic crises.

A Profitable Approach to the German Market

This is where our particular strategy came into play, and it proved to be a solid approach for . We saw seven buy signals between 2001 and 2023, and every single one turned a profit. What’s interesting is that these signals often appeared during major market lows, right before the market was about to take off on a significant run.

Three of the seven signals popped up in just the last four years, which shows the significant price swings the German index has experienced recently, especially when compared to American markets. For anyone treating , these moments of volatility can be incredibly valuable. These recent trades were actually the most profitable of the bunch, delivering impressive annual returns between .

Ultimately, this approach transformed an initial investment of into a final pot of , proving that can build a significant over time. It's one of those where the principles remain the same whether you start with a little or a lot.

Performance in Perspective

When we stacked the DAX against the 14 other indices we analyzed, it held its own. It ranked seventh for the highest average annual return at and came in eighth for total investment return with a solid . For those exploring a , this case study shows the potential that lies in disciplined .

In our simulation, the DAX stood out as the most efficient European index, slightly ahead of the French CAC40, which we'll look at next.