Investing in International Stock Markets from Chile

Chile Investment, how to invest in Chile, what to watch out for when investing, economic issues, currency exchange in Chile, and more.
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Re: Investing in International Stock Markets from Chile

Post by admin » Tue Dec 04, 2018 11:04 am

Well, my experiment clarified nothing.

Two ETNs distributions appear to have not been charged any tax. Those were all foreign bond funds.

One, dividend paying etf was charged 30%, but held all foreign stocks.

Another, dividend paying U.S. mortgage REIT ETN, all u.s. companies, seems to have withheld only 8% in tax.

You would think that much information would give a clue to how they are withholding tax on foreign investors. Not really.

On the upside, at least I made money. Probably dump the one withholding the 30%. Too small a dividend, on too low a growth stocks, to give up a 30% chunk. There are faster fish in the sea.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
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From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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Space Cat
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Re: Investing in International Stock Markets from Chile

Post by Space Cat » Thu Mar 07, 2019 12:31 pm

Not sure if the data is correct but this site says that almost 91% of Chilean equity funds underperform compared to S&P 500 in 5 years (76.5% in the US for the same period).

I wonder if those ≈1.3% of AFP fees are spent on losing money in a similar way instead of just putting all of it into Vanguard or at least the Chilean index.

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Re: Investing in International Stock Markets from Chile

Post by admin » Thu Mar 07, 2019 1:07 pm

That is pretty meaningless without at least defining what they mean by "equity funds" and are they comparing dollars or pesos, plus who knows what else.

The Chilean market did not do great last year overall, but down 70%? Hardly think so, no matter how you slice the pie. Believe in 2017 / 2016, Chilean stocks were the top performing Emerging markets in the World in dollar terms, think it was up something like 45 or 46%, so does that make sense that it would be down 86% relative to the S&P over the last 3 years?

Think they are comparing apples, oranges, and chickens.

I have the sneaking suspicion, they don't really have any stats on Chile at all and are just cherry picking to sell something.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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Re: Investing in International Stock Markets from Chile

Post by admin » Thu Mar 07, 2019 1:14 pm

I dug a little deeper in to their report, but still not sufficient info to draw any conclusions. They seem to only be tracking mutual funds:
Chile
 Following the trend of other Latin American markets in 2018, the Chilean equity market fell in the
first half of the year, by -4.39%.
 For the one-year period, 71% of active fund managers in Chile underperformed the S&P Chile BMI.
Even fewer managers were successful in outperforming over longer periods; 14% outperformed
over the last three years and 9% outperformed over the last five years.
Which, surprise, surprise, actively managed mutual funds suck, here, there, and everywhere.

I can loose money all by myself, thank you.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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Re: Investing in International Stock Markets from Chile

Post by scandinavian » Thu Mar 07, 2019 2:10 pm

It is comparing to S&P Chile BMI, not S&P 500

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Re: Investing in International Stock Markets from Chile

Post by admin » Thu Mar 07, 2019 6:15 pm

yea sorry, that was what it looked like at first glance.

i dont think it matters. they could be benchmarked against a thermometer, most funds dont invest in anything like the full spread of companies. they are mostly concentrated in the large caps, or at least they should be, because the majority of chile's mid to small cap public companies are way too illiquid to invest in.

i made that mistake of investing in one small cap, and i am stuck with a million pesos of trash i can not trade at any price. there simply no buyers. hope the company get's bought out some day or something like that. no more minnows for me.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
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From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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Re: Investing in International Stock Markets from Chile

Post by admin » Thu Mar 07, 2019 6:24 pm

scandinavian wrote:
Thu Mar 07, 2019 2:10 pm
It is comparing to S&P Chile BMI, not S&P 500
By they way, they just re-branded it with the S&P last year.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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Re: Investing in International Stock Markets from Chile

Post by Space Cat » Thu Apr 04, 2019 2:30 pm

Has anybody reported their foreign investments via this form in the "Declaraciones Juradas" section of My SII?

Is it obligatory? Or just declaring the income from dividends/sales in F22 should be enough?

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Re: Investing in International Stock Markets from Chile

Post by Britkid » Tue May 07, 2019 11:57 pm

So read the thread so for buying stocks in US companies while living in Chile looks like Renta4 and Interactive Brokers are two options worth looking at. Let me know if anyone has any more recent reports/reviews. I will look into it.

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Re: Investing in International Stock Markets from Chile

Post by Space Cat » Wed May 08, 2019 12:10 am

Britkid wrote:
Tue May 07, 2019 11:57 pm
So read the thread so for buying stocks in US companies while living in Chile looks like Renta4 and Interactive Brokers are two options worth looking at. Let me know if anyone has any more recent reports/reviews. I will look into it.
If you buy US stock directly while being a Chilean tax resident, you'll have to pay 30% tax on dividends because Chile still doesn't have a tax treaty with the US. Personally, I buy Irish Vanguard's ETFs (traded on LSE) via Interactive Brokers. There are often GBP and USD tickers for the same index funds, for example VWRL/VWRD.

You probably can't get cheaper than Interactive Brokers, they are almost the default recommendation on the Bogleheads forum (highly recommended, along with their wiki) for people who are not US residents. Renta4 is rather expensive, I use it exclusively for the Chilean stock exchange.

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Re: Investing in International Stock Markets from Chile

Post by jehturner » Wed May 08, 2019 11:48 am

It seemed like Internaxx had started accepting applications from Chilean residents again, last time I looked into it.

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Re: Investing in International Stock Markets from Chile

Post by Britkid » Wed May 08, 2019 10:16 pm

I have just looked at the site a little more and am not sure Interactive Brokers is right for me. $10 a month minimum charge/spend is a fair bit for me. I was thinking of investing about $1000 in one stock initially and then after some familiarity with it maybe going to about $10,000 at some point.

The type of investment I will do will be to spend 5 hours reading up on one company, then buy a few thousand dollars of their stock as a medium to long term investment, then just leave the investment for years. I could conceivably go months without even logging into the account. I'll probably only purchase in 2 - 5 companies in total. So, a say $10 commission for every purchase and sale might be fine (probably not $20+), but $10/month is not helpful.

It looks like Interactive Brokers is suitably for people trading more regularly.

I am not too sure about Renta 4 either. I have doubts about trusting a Chilean company that I don't know with a few thousand dollars. What if the company isn't trustworthy? I mean, how do you know? It's not like the UK/US where you can go online and easily find a hundred reviews from people that have used the company on several different review sites, all of which are known to be legit. You can't usually do that in Chile as easily.

I may have a look at Internaxx.

I also don't want something that will require me to scan documents or fill in a bunch of forms to get started. I'd like to be able to sign up and trade within an hour otherwise that's a negative point for me.

I do have an account with Fidelity.co.uk, and I called them together, and they said they plan to add US stocks at some point within 2020. So I may just wait for that. I actually can't remember if I told Fidelity that I am living in Chile. I might have done although I gave them my UK address. I did check with the funds that I invested in and they were OK with it.

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