Chile Stock Market Rally, beats all other EM markets

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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Wed Apr 26, 2017 9:31 am

The interest rates the banks are paying on say cds is already so low, i am not sure another cut matters. Think i seen 1.8% the other day.

On the other hand, as much as i hate having debt of any sort, the mortage rates have been so low it has me tempted to take a mortgage if i found the right property. It would have to be a pretty great property, but just the idea that it got me even thinking about it, means it is doing something.

I think of bank cds as a place to park short-term money until i can find a better place to invest it.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Fri May 05, 2017 8:20 am

so the big political issue in this year's presidential race will be the restructuring of the AFP. One of the proposals being debated is allowing clients to have more control over their retirement accounts and how they are invested. Of course, all the AFP are doing the song and dance that only professionals traders can manage investments, bla, bla, bla, bla. You know, the "professionals" I like to describe as the guys that can not beat a monkey with a dart board.

Obviously, a bunch of novice investors need a bit of a safety net, or some parameters to keep them from going crazy. I don't think grandma should be investing in things like options, but there definitely should be a bit more flexibility. For example, an 18 year old worker putting money in to an AFP now, really according to almost every other expert on the planet should be investing in almost 100% stocks. They should at least be able to push around allocations of money in to index funds vs say bond funds, and almost more importantly not pay super high rates for morons to loose their money. They hardly kept up with inflation last year.

so I stumble across this head scratching example of AFPs are dumping Fallabella. Their reason is it only up 6% this year.
http://www.pulso.cl/trader/afp-desinvie ... la-accion/

yet, the majority of annalist have a buy or a hold on Fallabella? I just seen an American investor recently on a stock forum, complain that he could not invest in Fallabella stock directly, and he thought it was one of the best run companies in Latin America. They are expanding in to markets all across latin america, offering pre-paid credit cards in markets that bank accounts are hard to get for many people, taking on Home depot and Lowe's in Mexico as they are pulling back due to Trump, etc, etc, all while having a 6% return more or less this year. They are and have been essentially expanding across Latin America, at a moment the latin American economies are just starting to take off and those investments will start to pay off.

Perhaps they are right, but I highly doubt it. Will revisit this at the end of the year, but I don't think over 10 or 20 years Fallabella is going to be a bad investment by any stretch. Do I expect 17% returns per year, no; but, it would also not surprise me if it did. It is not the particular stock, but the bizarre AFP behavior and investment reasoning. I would very much like to see how many of those AFP managers, bought Fallabella stock for their personal portfolios or their families portfolios while they were dumping the stock in public.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Fri May 05, 2017 8:21 am

so the big political issue in this year's presidential race will be the restructuring of the AFP. One of the proposals being debated is allowing clients to have more control over their retirement accounts and how they are invested. Of course, all the AFP are doing the song and dance that only professionals traders can manage investments, bla, bla, bla, bla. You know, the "professionals" I like to describe as the guys that can not beat a monkey with a dart board.

Obviously, a bunch of novice investors need a bit of a safety net, or some parameters to keep them from going crazy. I don't think grandma should be investing in things like options, but there definitely should be a bit more flexibility. For example, an 18 year old worker putting money in to an AFP now, really according to almost every other expert on the planet should be investing in almost 100% stocks. They should at least be able to push around allocations of money in to index funds vs say bond funds, and almost more importantly not pay super high rates for morons to loose their money. They hardly kept up with inflation last year.

so I stumble across this head scratching example of AFPs are dumping Fallabella. Their reason is it only up 6% this year.
http://www.pulso.cl/trader/afp-desinvie ... la-accion/

yet, the majority of annalist have a buy or a hold on Fallabella? I just seen an American investor recently on a stock forum, complain that he could not invest in Fallabella stock directly, and he thought it was one of the best run companies in Latin America. They are expanding in to markets all across latin america, offering pre-paid credit cards in markets that bank accounts are hard to get for many people, taking on Home depot and Lowe's in Mexico as they are pulling back due to Trump, etc, etc, all while having a 6% return more or less this year. They are and have been essentially expanding across Latin America, at a moment the latin American economies are just starting to take off and those investments will start to pay off.

Perhaps they are right, but I highly doubt it. Will revisit this at the end of the year, but I don't think over 10 or 20 years Fallabella is going to be a bad investment by any stretch. Do I expect 17% returns per year, no; but, it would also not surprise me if it did. It is not the particular stock, but the bizarre AFP behavior and investment reasoning. I would very much like to see how many of those AFP managers, bought Fallabella stock for their personal portfolios or their families portfolios while they were dumping the stock in public.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Fri May 05, 2017 9:43 am

i had the thought. What might be fun to test, if I get the time, is to dig out an investment list of the AFPs, then do an historical check against a fictional portfolio. Essentially see if say over the last 5 years, if you had bought every time the AFP's sold, how would you have done?

If that checks out, might not be a bad strategy for a small portion of the portfolio. At the very least, you know these AFPs have massive investments, so they are going to move the price when they sell a stock regardless of reason.

Perhaps it would work better to then apply some more traditional stocking picking to that litter of puppies to make sure there is no real fundamental reason (e.g. company is going bankrupt).
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Wed May 10, 2017 10:50 am

interesting JPmorgan is predicting a break above 5,500 for the IPSA, on the back of the political cycle in Chile. We are as of this post at 4,818 and change.

http://www.economiaynegocios.cl/noticia ... ?id=359286

I don't know, I would probably say that is possible, in the neighborhood of 15 to 30% more. However, I am not sure there is sufficient wind under the IPSA to hold that without some clear domestic stimulus of some sort (more than just cutting interest rates). We would most likely need a copper and commodities rally to support that, or a hell of rally out of the rest of south america.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Wed May 10, 2017 11:00 am

perhaps a rally in the peso, to something like 600 or below might do that too.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by eeuunikkeiexpat » Wed May 10, 2017 11:18 am

"Predictions" to the "public" masses like that from Big Money elite financial in$titution$ are not to "help" or "advise" the slaves. Thus, it will never reach that level or blow way past it with a little help from their friend$.
Generally, just a SPAM KILLER. You are on your own in this forum. My personal mission here is done.

BUT when necessary, by way of ridicule and truth revelation we shalt do war.

--eeuunikkeiexpat

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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Wed May 10, 2017 12:58 pm

eeuunikkeiexpat wrote:"Predictions" to the "public" masses like that from Big Money elite financial in$titution$ are not to "help" or "advise" the slaves. Thus, it will never reach that level or blow way past it with a little help from their friend$.
yea, where were they last year?

There was a few little articles going around about investing in the Chilean stock market in English from the big boys, but it pretty thin coverage.

There is a pretty persistent pattern in these EM recommendations.

So, start with whatever market has been really beat down, and has bottomed out.

First, you get the big bond guys, then you get the big stock guys, the hedge funds and vultures, all quietly buying in to the market. They don't say much in public, and are generally pretty conservative with their investment as to not draw attention to what they are doing.

The market rallies sufficiently to get on the radar screen, then those big guys start putting out recommendations and press releases, to juice the market some more. They of course point to the 10, 20, 30% gains last year.

Then the general institutional investors start buying, ETF rebalance, whatever. A little more jump, but not as great as the prior one. ---- I think we are at this stage or the prior one.

Then you start getting the articles about the "miracle of <insert country here>". ---- by this point, it is too late. The volatility goes up, as the rally peters out and gets a little tipsy.

The dumb money then starts flowing in, the smart money has left the building. ---- at which point the average investor is left scratching their heads as to why they can not reproduce what the big guys did at the first phase.

Market implodes.

Rinse and repeat the pump and dump of an entire economy like it was some sort of penny stock.
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Guess who the Socialist Party invested in?

Post by admin » Thu May 11, 2017 10:15 am

Guess who the Socialist Party invested their money in?

SQM ---- Sociedad Química y Minera

https://www.df.cl/noticias/economia-y-p ... 84523.html

If you are not aware, this is the very mining company they have been holding up as the poster child of corruption, and threatening to take away their concession. For the left, they are public enemy number one because the company was founded by the son in law of Pinochet, after winning the mining concession at the end of the dictatorship.

Which I guess is only fair, since SQM invested in the socialist party with campaign contributions.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by frozen-north » Thu May 11, 2017 10:55 am

admin wrote:
SQM ---- Sociedad Química y Minera

If you are not aware the very mining company they have been holding up as the poster child of corruption, and threating to take away their concession. For the left, they are public enemy number one because the company was founded by the son in law of Pinochet, after winning the mining concession.
' winning the mining concession' ???

Not so simple:
Cómo Julio Ponce Lerou se quedó con Soquimich

http://www.elmostrador.cl/noticias/pais ... soquimich/
Todos los hombres de Ponce Lerou

Pasó de simple funcionario de la dictadura a multimillonario empresario. Varios miembros de grandes grupos económicos fueron beneficiados por Ponce Lerou cuando ostentaba cargos en el gobierno militar y luego han formado parte del directorio de Soquimich como Wollf Von Appen, Hernán Büchi, Juan Hurtado Vicuña, Juan Rassmuss y Patricio Contesse,

http://www.theclinic.cl/2015/03/24/todo ... nce-lerou/
Cómo se hizo millonario Julio Ponce Lerou, el yerno del dictador.

En poder de la Fiscalía existe un listado de numerosos parlamentarios y figuras ligadas al mundo político, quienes a través de boletas a nombre de familiares, asesores, amigos, empresas y think tanks, habrían recibido de manera irregular financiamiento de manos de Ponce Lerou. Se trataría de 13 senadores y 37 diputados pertenecientes a la Nueva Mayoría y a la UDI, según explica la revista.

http://vozciudadananoticias.com/2015/06 ... -dictador/

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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Fri May 19, 2017 10:52 am

Funny, the Native Americans say the same thing about all those mining concessions.
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Re: Chile Stock Market Rally, beats all other EM markets

Post by admin » Fri May 19, 2017 10:56 am

well that was a interesting ride for the Chilean stock market yesterday, as Brazil crashed and burned. Today it seems to be shrugging it off. seems most anything with exposure to Brazil got thrashed, and today there seems to be buying.
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