The Benefits of the Ginmon Index

The new index offers a more realistic picture of the global economy while overcoming significant drawbacks of classical indices.

Originally, indices aimed to create a meaningful indicator or benchmark for a regional or global stock market.

In times when five individual companies (FAANG stocks) represent almost 25% of the S&P 500's weighting, this goal is increasingly missed.

Thus, not only private investors but also many professional market participants have often wondered: How is it possible for the stock markets to record new highs while the world is simultaneously on the brink of the worst recession in almost 100 years?

The Ginmon World Economy Index was launched with the aim of providing a meaningful indicator of the global economy. To this end, the main drawbacks of classical indices were addressed through an alternative composition.

• The USA are heavily overweighted in classical indices.

• There is an overrepresentation of (American) tech stocks.

• Standard indices only consider large companies.

• Standard indices do not include commodity prices.

• Standard indices do not include real estate prices.

• Standard indices underweight developing countries.

How often is the Ginmon Index published?

The World Economy Index is continuously recalculated by Ginmon. Moreover, Ginmon provides a factsheet that explains the exact composition of the index in detail.

A quarterly market commentary by Ginmon's Chief Investment Officer (Fabian Knigge, CFA) regularly summarizes the key developments of the index, and thus the global economy.

Based on the World Economy Index, many current questions can be easily answered:

• How is the global economy doing when adjusting stock prices for the tech stock rally?

• How much have the stock markets decoupled from real economic development?

• How far is the global economy actually from its all-time high?

• Are stock prices overvalued in light of the economic development?

• Is the composition of classical indices like the MSCI World still relevant?

About Ginmon

Founded in 2014 by Lars Reiner and Ulrich Bauer, the digital asset manager Ginmon offers private clients services that were previously reserved for very wealthy clients. Ginmon operates with currently 30 employees as a licensed asset manager according to §32 of the German Banking Act and is subject to supervision by the Federal Financial Supervisory Authority (BaFin).

The in-house apeiron® technology monitors and optimizes customer portfolios, which Ginmon manages at BNP Paribas, the market leader for custody services in Germany.

As the only provider, Ginmon consistently relies on the three-factor model, an investment concept inspired by Nobel laureates Eugene Fama and Kenneth French.

In cooperation with the consulting company Mercer, Ginmon also targets employers who wish to provide their employees with access to digital asset management to complement their company pension schemes.