General Question

talljasperman's avatar

How much would it cost to buy one ( or minimum ) of every stock in the world stock market?

Asked by talljasperman (21916points) July 16th, 2013

And what is the, investor slang, name of doing such a thing? A better word than diversifying? Like drinking swamp water? ( drinking every type of pop in one cup)

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5 Answers

Imadethisupwithnoforethought's avatar

There is no World Stock Market. Not saying that to be a jerk. Do you mean what it would cost to buy the minimum purchase possible in an index fund that covered a broad variety of stocks in each of the largest countries with stock exchanges? That would be a ton of research. Maybe the Russell Globall Index would be helpful? I am not sure of a company that offers a fund tracking that.

LKidKyle1985's avatar

I think they meant every stock available to purchase in the world, but yeah I have no idea probably more than 20,000 dollars, less than 100,000…. maybe…

Imadethisupwithnoforethought's avatar

It becomes a mess regardless. Berkshire Hathaway A shares run close to 200k. B shares are a couple hundred. So the q is hard to parse as is. And Berkshire Hathaway just invests in shares of other companies. So it gets super messy.

CWOTUS's avatar

You could figure that cost, I suppose, market by market, if you pick up a Wall Street Journal, Investor’s Business Daily (or even a comprehensive listing online somewhere, though I don’t think I’ve ever run across one) and just add up the closing share prices of all the listed shares. Of course, you might start with the New York Stock Exchange, then NASDAQ (or vice versa, or maybe the Toronto or Vancouver exchanges in your case), and then find listings for the various companies listed on all foreign exchanges as well and do the same thing there. Somewhere along the way you’d want to make sure that you weren’t listing companies twice, by their “common” and “preferred” stocks, and by their domestic and all foreign listings, as well as some foreign stocks that trade in the USA, too.

I don’t think you’d need to worry so much about avoiding stocks like Berkshire Hathaway and other holding companies, since they are also companies in their own right, with management interested in their own profits as well as the companies they hold from time to time. However, there are stocks that are not “holding companies” but more like mutual funds, though traded as common stock. I’m thinking of one that I used to own many years ago, sold on the NYSE, and called “The India Fund”. It’s a market basket of various Indian company stocks, traded under “IFN” on the NYSE. That closed today at around $20 per share. I’m not sure how it’s made up any more; I doubt that it follows the model that you’re proposing. (No one would, since the valuations are all over the map, as you’ve just seen.)

Of course, you’d also need to be aware of currency valuations, since you can’t buy stocks in Paris, for example, with US or Canadian $.

I’ve never even looked at Japanese or Chinese markets, so I have no feel for them at all. (Not much for the European markets, for that matter.)

I think it would end up costing you on the order of $500 K or more. (Berkshire Hathaway closed today at around $175,000 per share, so that’s going to be a hugely weighted stock in your portfolio.)

So… here you go so you can get started. Let me know how it turns out.

zenvelo's avatar

According to the World Federation of Exchanges, there were 46,332 listed issues across all markets ta the end of 2012. Let’s suppose the average share of stock costs $25, it would therefore cost $1,158,300 to buy one share of every stock. ($25 a share is a guess, very difficult to determine the average price per share even on a single exchange, it is not a tracked number.)

Of course, you’d pay commission on that, best commission prices in the US are $8 a trade at a discount broker. Apply that across all issues, that would mean $370,000 in commissions, a definitely low ball number.

So, given my assumptions, it would cost at least $1.5 million to do the ultimate diversification.

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