Investing in Brazilian ETFs
NEW YORK ( ETF Expert) -- If you look hard enough, you can find a whole lot of things that are wrong with the "B" in BRIC.
Brazil's GDP growth is virtually non-existent. Government regulatory intervention in both the energy sector as well as the financials segment has been increasing. Brazil's currency lost approximately 7% against the dollar on a year-over-year basis, hurting unhedged investment in the nation.
On the other hand, if India, China and Russia can find their way out of the emerging market bear cave, wouldn't there be reason for some optimism on Brazil?
The central bank there has cut rates 5.25% over the previous 15 months; assuredly, that stimulus should find its way into the economy as well as equity markets. What's more, the government has reduced taxes while investing in infrastructure for the upcoming games (i.e., 2014 World Cup, 2016 Olympics).Indeed, a Brazilian stock bull may soon override pervasive negativity. Consider the Brazilian currency via WisdomTree Dreyfus Brazilian Real (BZF). The "real" has been in a dreadful downtrend since July 2011. Yet, for the first time in more than three years, it appears BZF's 50-day trendline may cross above its 200-day trendline. Note: The bullish technical event is known as a "golden cross," and it represents the opposite of what iShares 20+ U.S. Treasury Bond (TLT) is
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