Brazilian stocks: Well, if you've owned just one Brazilian stock for a while, and it is SBS, then you likely show green. I have held and do still hold several in addition to SBS, and I'm not a happy investor. The Brazilian government has instituted rulings which make profits difficult for companies in several sectors -- utilities, oil, banking. These are just the sectors that contain the larger companies that USA investors can purchase otc or on NYSE. For example, PBR, ITUB, CPL, EBR. I noticed in the Barron's article, that it seems almost all of the stocks that the fund managers recommend are middle-tier or lower-tier companies that don't seem to trade in USA market. Such companies are very expensive to buy (in small amounts for small investors) on the Bovesta. (There was a small cap etf fund mentioned though.) I'm presuming these are companies (cosmetics/retail/small mfg. suppliers) where the managers believe the companies will prosper with growth in Brazil's middle class or the build up of infrastructure for upcoming soccer/olympics. And that the companies are small enough or in sectors such that they won't be "attacked" by the Brazilian government.
I also hold a couple of losing positions in stocks controlled by billionaire Eike Batista, the guy who publicly aspires to be the world's richest person by 2015. I don't understand that from the stocks I have -- they are down quite a bit from my purchase price.
What I am doing for now is holding on, maybe selling a couple for tax losses, and refraining from buying any more Brazilian stocks for now. (May add to losing position in EBR though.) I have shifted my interest and my focus to Colombia where I believe I see opportunities and a more investor (outside investor) friendly government. |
