by Ben Miller
Concerns over political and inflation risks have hit equity portfolios dedicated to the region. Investors are now on the hunt for value and diversification away from Brazil.
LatAm equity funds have had a bumpy ride of late as regional
indices dramatically underperformed US stock markets during the
first half. But portfolios remain in good shape year-on-year
thanks to the post-crisis resurgence in 2010. Investors are now
seeking buying opportunities and diversification away from
Brazil, while also keeping their faith in the
region’s consumer growth story.
Concerns over inflation, particularly in Brazil, and the
return of political risk in Peru after the election victory of
left-wing presidential candidate Ollanta Humala, have weighed
on prices this year and subsequently dented dedicated LatAm
For the year to June 1, the MSCI LatAm index was down 1.2%,
reflecting the largely lackluster performance across the region
in dollar terms. For instance, Brazil’s Ibovespa
index fell 4% over the same period, making it one of the
region’s worst performers with the exception of
the 12.6% dip seen on Peru’s...
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