Did you see the very indepth 75 second package on foreign investing on CNBC?
There was one chap at the end from Barclays who was bullish on Latin America. I have been a fan of the region from long before I started this blog. I have two individual names, one from Brazil and one from Chile, to try to capture the effect in addition to whatever influence Latin America may have on ADRE.
In the last month or so most of the stocks from this part of the world have had a big spurt higher, very big. Last week I reduced exposure on one of the names because of how much the group has moved. I am no less bullish but the weighting is a little bigger than ideal and that the group could pull back for a month or two seems plausible.
If you have zero exposure, you probably should have some but if you already have some it may make more sense to wait a little. This opinion may seem two faced but that it might stall out for a while could be wrong. Anyone that owns the region will benefit if it rallies more from here, which is possible. No exposure obviously means no benefit.
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5 comments:
Roger,
This is more of a portfolio management question. So your Latin American stocks have run up and you're still fundamentally bullish on the names. For a brand new account, do you go straight into the full allocation, or do you use the charts to buy in on weakness?
Thanks
great question
i have one bank that is not much of a high flier but it rallied 30% in a very short time that is the one I eased up on. the other stock is a materials name that I would buy now just because at some point it will rally 40% again and I can only guess when that will happen. hope that helps.
The question I have is this: Why is Latin America taking off so rapidly? What's driving it? Is it currency related?
latam has spurts where it just goes on a tear. i would imagine sometimes the fundies justify it and sometimes not. the last spurt was in jan of 2005.
this move could have been about solid fundamentals or strong latam currencies (but I doubt it) or maybe US investors chasing heat.
The more important thing is that i'm not sure I could game when this will occur, I believe in theme in a big way so I always maintain some exposure.
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