Sign up now for TIME's WorldWatch email newsletter. Superdiplo's share price doldrums have nothing to do with its balance sheet, and everything to do with an unintended side effect of Europe's new single currency. In recent years the Spanish, Portuguese, Italian and Irish markets benefited as domestic fund managers filled their portfolios with homegrown stocks as a hedge against currency risks. That bias allowed well-performing companies like Superdiplo to be big fish in the relatively small ponds of Europe's fringe markets. But currency risks evaporated with the advent of the euro last January.
Numbers tell the story.
The number of Irish stocks in the average Irish fund portfolio will be halved by early 2000. The decline in demand has pushed stock prices lower. And most of the blame goes to the proclivity of fund managers to reweight their portfolios. Back then, country-level analyses were popular with investors and the exchanges benefited from being in countries experiencing rapid growth. Now, investors are increasingly picking stocks by sector.