Dutch investors had a profitable first quarter: in the first three months of 2024, the value of their combined investments rose by €13.1 billion. Households posted returns of €11.3 billion due to higher stock prices, and they made additional net purchases of €1.8 billion.
© iStock
This brought the total value of investments of Dutch households to €180.1 billion (+7.8%). The €13.1 billion rise is the biggest quarterly increase since late 2020, when stock markets rebounded sharply during the COVID-19 pandemic.
At De Nederlandsche Bank, we independently compile statistics on the Dutch financial sector and economy. This article is based on these statistics. More information on our statistics and all dashboards can be found on our Statistics homepage.
The majority of Dutch households' investments are in investment fund units. Dutch households achieved a €6.3 billion return on these investments in the first quarter of 2024.
At the same time, households purchased a net €0.8 billion worth of positions in investment funds, whereas the last quarter of 2023 saw record sales of positions (€2.4 billion). These yields and new purchases increased the total size of investment fund positions by €7.1 billion (+6.8%) to €111.8 billion.
The growth in the value of investment funds can largely be ascribed to rising stock market prices. For instance, the value of equity funds increased by €6.1 billion (+10.9%) to €62.1 billion at the end of the first quarter of 2024.
New figures from DNB show that households have diversified their assets in global investment funds relatively strongly compared to other asset classes, such as direct investments in listed equities. Positions in the 25 largest investment funds account for about 30% of all fund holdings.
In addition, households achieved returns of €4.7 billion on direct investments in equities, while also completing €0.3 billion in net purchases. As a result, the value of equity holdings increased by €5.0 billion (+8.8%) to reach €61.7 billion at the end of the first quarter of 2024, meaning Dutch households’ holdings of listed shares were near the record level of €62.2 billion reached in the fourth quarter of 2021.
In the first three months of this year, the AEX index rose 12% to 881 points. It even reached a historic high in early May, topping 900 points.
Converted into euro, the MSCI World Index rose by 11% in the first quarter of 2024. About 40% of the equity assets of Dutch households are invested in Dutch companies and 25% in US companies. Dutch households’ return on investments in listed shares was lower than the gains of the two aforementioned stock market indexes (AEX and MSCI World).
Driven by purchases of money market paper and bonds, the value of debt securities held in Dutch households’ investment portfolios also increased sharply. In the first quarter of 2024, these positions totalled €6.6 billion, the highest since October 2016. The value of household bond holdings has been on the rise for some time.
The total securities holdings of Dutch households consisted of listed shares, investment fund positions and debt securities totalling €180.1 billion in the first quarter of 2024. By comparison, Dutch households keep far more funds in savings accounts with Dutch banks (€467.8 billion) than in investment portfolios. They also hold €113.0 billion in payment accounts with Dutch banks. Added to this are substantial assets kept with pension funds and insurers, business assets of self-employed persons and home equity, which fall outside direct securities holdings.
According to figures from Statistics Netherlands (CBS), there are 8.3 million private households in the Netherlands. Of these, around a quarter (1.9 million) invest, according to research (in Dutch) conducted by the Dutch Authority for the Financial Markets (AFM).
Table 4.6: Investments by Dutch households in securities
Dashboard: Securities holdings of Dutch households
The proportion of bonds carrying negative yields fell sharply in the first half of 2021 on the back of rising market rates. As of 30 June 2021, the combined nominal value of Dutch bonds with negative yields totalled €624 billion, down €142 billion on 31 December 2020.
Read more Volume of Dutch bonds with negative yields has fallen sharply
The market for Dutch green securitisations of residential mortgages and for green covered bonds more than tripled in size in 2023 compared to 2022, DNB figures show, reflecting investor demand for green investments.
Read more Sharp increase in green securitisations in 2023
Dutch households on balance sold €4.7 billion worth of investments in the fourth quarter of 2023. This is the highest amount since our record-keeping of this data began, in 2009. Despite historically high sales, the value of household investments still increased due to rising stock prices.
Read more Households sold historically high levels of investments in late 2023
By highlighting several financial stability risks, Olaf Sleijpen illustrated how central banks’ measures to safeguard price stability interact on various levels with various stakeholders – be it households or corporates, the general public or governments.
Read more “Central bank independence against the background of higher interest rates and financial stability: ceteris paribus or mutatis mutandis?”
