I assure you, Taiwan is no stranger to free enterprise. :-) As you discovered for yourself, however, it is almost impossible for non-roc folks to participate directly in the TSE. And Citibank, by being granted the rights to the ADR/ADS, has a monopoly on the service of buying TSMC shares for us, the unqualified "foreigners," on the TSE, and charging us a markup -- like the guys who stand outside 7-11 offering teenagers to buy their beer for them.
Because par-value, cash dividends, and voting rights are the only ways in which the number of shares we own matters, and because most of us don't give a hoot about those three, there is no impetus for this hefty markup to change. Remember, there is no such thing as an undervalued or overvalued stock: your stock is worth exactly what the market will pay for it, which in the case of TSM, is xx% more than what it will pay for TSMC. The price differential is nothing to worry about if you are interested in long-term capital appreciation, especially considering the possibility that the premium is just as likely to rise as it is to fall. |
