FRANKFURT/KÖLN (dpa-AFX) - The bulk of the value created for investors on the German stock market is accounted for by very few stocks. Over the past 20 years, 1.7 trillion euros in value has been generated via price gains, dividends and share buybacks, according to a new study by the Flossbach von Storch Research Institute, a think tank of the Cologne-based asset manager of the same name with around 70 billion euros in client money under management. However, many German stocks have brought investors no money on balance since January 2003, while according to the study, as many as twelve stocks accounted for half of the total value created.

The study analyzed all of the 1,000 or so shares in German companies that were publicly traded in Deutsche Börse's Prime Standard and General Standard segments between the beginning of 2003 and December 2022. The experts measured the value created by the shares against the yield of German government bonds with one month to maturity to create a comparison with very short and safe investments - similar to holding money in an account during the years of the low-interest policy. Stock returns above those of such federal bonds were defined as value creation. The start of the study was set for January 2003, so that the stock market was examined from a low point after the collapse of the New Market.

The result: of the total value created, a good half (52 percent) was accounted for by dividends alone. The remaining 41 percent came from price increases and 7 percent from share buybacks.

If the created value of all shares is listed in a ranking, this results in the sum of 1.7 trillion euros. This amount is already reached with the first 118 shares, around 12 percent of the securities. Some stocks behind them also created value, but their contribution was eaten up on balance by loss-makers. "Only a few large, mostly well-managed companies in attractive sectors dominate the German stock market," says study author Philipp Immenkötter. "They have been listed for a long time and have grown over the years."

According to the study, Dax companies Siemens, SAP, Allianz, Mercedes-Benz Group and Deutsche Telekom created the most value for investors, with more than 75 billion euros each. They were followed by BASF, BMW, VW (common shares), Munich Re and Deutsche Post. The shares are almost all also among the major dividend payers in the Dax. Among the biggest value destroyers since 2003 are the securities of Commerzbank, real estate financier Hypo Real Estate Holding and Deutsche Bank, which came last (1013) with almost 25 billion euros in value destroyed. The insolvent payment service provider Wirecard came in at 938th place.

However, the picture is also related to the period under review: If the analysis had been carried out before the collapse of the Neuer Markt, Deutsche Telekom, for example, would have performed worse.

For investors, the weak performance of the vast majority of stocks means that "great caution is called for when choosing stocks," wrote author Immenkötter. Only just under 58 percent, or six out of ten German shares, generated long-term value.

It is well known that investors take high risks with individual shares of even large corporations. Experts therefore advise investors to diversify their stock market investments very broadly and globally - for example, with funds or low-cost exchange-traded index funds (ETFs), which do not require a fund manager. After all, very few investors - whether private or professional - manage to find the profit-makers on the stock markets in the long term./als/DP/stk