Strong shekel, exciting year for Israeli stocks

One shekel coins

Israeli Stocks Soar

Many sectors of Israel’s stock market provided investors phenomenal returns in 2016. While the overage large-cap stock index (TA-100, now known as the TA-135) lost 2.5% due to a few large pharmaceutical shares losses (Teva, Perrigo and Mylan), the secondary large-cap stock index (TA-75, now known as the TA-90) returned 17%.

Even more impressive was the MidCap-60 stock index, which returned an impressive 24% for 2016.

The TA-Technology Index (TA Tech-Elite) also yielded a 24% return, and the TA-BlueTech (technology and biomedical) stock index grew 15%.

Tel Aviv’s financial stocks (TA-Finance) gained 19%, which the ever-growing Israeli building boom created 17% growth for Israeli building and construction companies (TA Real Estate-15).

Continuing the quest for natural gas and oil in Israel and in our offshore territorial waters, the Israel Oil & Gas Exploration stock index produced 18% for investors in 2016.

These and other stocks indexes may be purchased in shekels in an Israeli brokerage account, which can be opened remotely from anywhere in the world.

Israel Shekel Remains Strong

Not only was 2016 a good year for many Israeli stocks indexes, but also the Shekel has held its ground against a strengthening U.S. Dollar. The NIS grew 1.5% in value in 2016 against the USD. Looking at the performance of the various world currencies against the USD in the past five years, we notice that Israel’s Shekel was one of the only currencies to maintain its strength against the U.S. Dollar. Almost all other currencies lost against the USD between 2011 and 2016:

  • Canadian Dollar: -22%currency-performance-vs-us-dollar-300x225
  • British Pound: -19%
  • Australian Dollar: -28%
  • Japanese Yen: -32%
  • Euro: -16%
  • South African Rand: -41%
  • Russian Ruble: -48%
  • Chinese Yuan: -8%
  • Swiss Franc: -6%
  • New Zealand Dollar: -10%
  • Singapore Dollar: -10%
  • Danish Krone: -16%
  • Swedesh Krona: -22%
  • Indian Rupee: -26%
  • Mexican Peso: -37%
  • Brazilian Real: -44%
  • Turkish Lira: -52%

So not only was performance strong for stocks held in the shekel, but the shekel itself maintained its strength while investors’ cash and investments in other local currencies eroded in value. Wise investors should consider diversifying their holdings globally, with exposure to the Israeli shekel and Israeli innovative companies.

This article originally appeared on Wise Money Israel, February 15, 2017, and reposted with permission.