The year 2021 was again shaped on the stock markets by the corona pandemic on the one hand and low interest rates, the ultra-loose monetary policy of many central banks and the records on Wall Street on the other.

Some pandemic winners as well as technology and luxury goods manufacturers topped the winners' lists.

Stocks with high (gross) dividend yields also delivered significant gains overall, but were not the leaders of this bull market from a technical point of view.

With a view to 2022, against the background of the impending turnaround in interest rate policy at some central banks, such as the US Federal Reserve, the (excessively) high inflation rates and the further economic recovery, it should be a very big challenge to achieve a positive performance on the euro bond markets. A stock dividend strategy should offer a good chance of a positive total return in 2022 due to the intact earnings trends of the companies and the appealing (gross) dividend yields. With this strategy, a basket of Euro Stoxx 50 stocks should be put together with a combination of attractive (gross) dividend yields and an attractive overall technical situation.The selection procedure used in previous years now delivers an equally weighted basket of shares consisting of Allianz (security freeze 160 euros), Axa (19 euros), BASF (45 euros), BMW Stämme (65 euros), Enel (4.50 euros) and Sanofi (65 euros).

Exchange rate development and inflation

The conservative strategy for 2021 or the “technical analysis / dividend strategy” consisted of an equally weighted basket of shares from Axa, BASF, Deutsche Telekom, Iberdrola, Munich Re and Total. In the investment period from January 11, 2021 (closing prices), an overall performance of plus 13.8 percent was achieved. This includes the dividends reduced by the respective country-specific tax rates. In the same period, the Euro Stoxx 50 Net Return, in which the dividend payments reduced by the country-specific tax rates are also converted proportionately into price increases, achieved a gain of 21.4 percent. The Iboxx Germany - that stands for Iboxx Euro Germany Sovereign Overall Total Return Index - is a bond performance index that is representative of the yield curve of German government bonds.Last year it delivered a negative price development of minus 2.6 percent. The price development of the various strategies in 2021 should still be seen against the background of the high inflation rates in Germany and in the euro zone.

If you add up the dividend strategies of technical analysis presented since the beginning of 2005 with the respective swaps made at the turn of the year, the total price increase is 145.2 percent.

The Euro Stoxx 50 Net Return Index, which represents a “buy-and-hold strategy”, has now achieved an increase in value of 109.7 percent over the same period.

An investment in Iboxx Germany (formerly in the REXP index) brought in an increase of 69.3 percent during this investment period.

The technical analysis dividend strategy thus significantly expanded its performance lead over the “buy-and-hold” strategy for (government) bonds in the past year.

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