Tag Archive | Latin America

Three Reasons To Consider Colombian ETFs

As commodity prices continue to increase and the US dollar remains weak, commodity rich frontier markets, in particularly Colombia, may pose an opportunity to investors. 

One of the primary drivers behind Colombia’s’ appeal is its vast supply of natural resources.  The nation is rich in oil, coal and other minerals, all commodities that are likely to witness elevated demand from both developing and developed nations as the global economy mends and economies grow.  Furthermore, the Colombian government has implemented a series of policies such as the Andean Trade Promotion which is encouraging a more diversified export base other than the United States and Venezuela, its two largest trading partners.  Additionally, Colombia is pursuing free trade agreements with Asian and other South America nations, which are two regions that are expected to witness increased appetites for natural resources, in particularly oil and coal.  Read More…

Three ETFs Potentially Impacted By Floods In Brazil

Brazil is currently suffering from of one its worst ever natural disasters after extensive rainfall and flooding has caused massive mudslides and killed many people, potentially having an impact on production of coffee and sugar in Latin America’s largest economy.

According to BBC News, harsh storms in the nation dumped the equivalent of one month’s rainfall in just a few hours on Wednesday, sending mudslides ragging through towns, destroying homes, roads, and bridges, while taking out power and telephone lines.  Worst of all, municipal offices in the Serrana region, just north of Rio de Janeiro, have reported that death tolls as a result of the mudslides have surpassed the 500 mark and continue to grow.  Read More…

Two Latin American ETFs For 2011

As the developed world continues to struggle out of the Great Recession, emerging markets performed relatively well in 2010 and are expected to sustain this growth and performance in the coming year.  China continues to draw headlines and steal most of the attention; however, in the coming year, Latin America may be the place to look and for good reason.

Inflationary threats and real estate bubbles have taken front and center stage in China, resulting in the nation increasing its benchmark interest rates for the second time in three months and increasing banking reserve ratios to reduce risk, which could hinder future economic growth.  A different song is being sung in Latin America as inflation is expected to remain subdued, which is expected to lower pressure on central banks to change interest rates which will likely further limit the possibilities of tighter monetary policies. Read More…

9 ETFs To Play Currency Debasement

As developing nations continue to implement loose monetary policies, keep interest rates low and boost money supply, a nation’s debt and currency debasement should me of much concern. 

Most recently, a study indicated that the U.S. national debt has ballooned nearly 12 fold over the last 30 years.  Additionally, over this same time span the ratio of debt to GDP has gone from nearly one-third to 85%.  During this time of exploded debt, GDP has only expanded 5.3 times, indicating that debt is growing at twice as fast as the U.S. economy.  Similar trends have been seen in Europe, in particularly Greece, Spain and Portugal.

Some concerns of this exponential growth in debt include hyperinflation, as a result of printing more currency, a decline in the value of a nation’s currency, better known as currency debasement, and increased costs of borrowing, which make it difficult to chip away at deficits. Read More…

Four ETFs To Play Brazil’s Prosperity

As fears of weak economic growth continue to prevail in the U.S., Brazil has been a hot ticket amongst emerging markets and is likely to continue to witness a booming economy.

The South American nation is rich in natural resources and is a leader in global agriculture.  The recent global boom in commodities has fared well for the largest national economy in Latin America as its exports of beef, soybeans, coffee, orange juice, iron ore and steel have all increased.  Furthermore, this elevated demand for natural resources is expected to be sustainable as global populations continue to expand and the purchasing power in developing nations increases.  Read More…

CIVETS: The Next Gateway To Growth

After the exceptional economic growth and prosperity witnessed by emerging markets, like China, India and Brazil, the CIVETS, Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa are expected to be the growth leaders in the next decade. 

As a whole, the CIVETS have appeal due to their large, young and growing populations, diversified economies, decent financial systems and political stability, when compared to their counterparties.  Additionally, the Economist states that all six nations are relatively unhampered by high inflation, trade imbalances or sovereign debt woes.  Read More…

Colombia ETF Could Pose Opportunity

As investors continue to be fearful of a double-dip recession or a lost decade in the US, Latin America, in particularly Colombia, and its exchange traded funds (ETFs) have reaped the benefits. 

So far in 2010, the Bolsa de Valores de Colombia has surged more than 35% and the nation’s GDP has grown by nearly 5%.  A major reason Colombia has seen such growth and prosperity, and is likely to continue to do so, is its supply of natural resources that the world demands.  The Latin American nation is rich in oil, coal and gold, which are amongst the nation’s largest exports and account for nearly 13% of its GDP.  What further boost appeal for Latin America’s third most populous nation is that all three of these commodities are likely to remain in high demand in the coming years.

A second reason Colombia’s economy is expected to witness, or at the very least sustain this growth, is that political instability in the region has started to ease.  It appears the Colombian government is in complete control of their nation and threats of violence or a political uprising by the Revolutionary Armed Forces of Colombia (FARC) are no longer prevalent with a new President in office.  This increase in political stability has resulted in a decline in violence, has opened up Colombia to international investment and has boosted domestic consumer spending.  Read More…

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