Advanced, Country Specific Investing

Investing in Argentina

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Argentina is a South American country that is one of the G-20 economies. It is the third largest economy in Latin America and has the highest GDP per capita in its region. It possesses plenty of natural resources, a strong agricultural sector, and a well-educated population.

Argentina’s Main Industries
 Argentina is economically known for its strength in:

  • Agriculture
    • Beef
    • Fruits and Vegetables
    • Wheat
    • Cattle
    • Natural Resources
      • Mining
        • Coal
  • Metals
    • Gold
    • Copper
    • Zinc
    • Magnesium
    • Uranium Silver
  • Energy
    • Oil and Petroleum
    • Natural Gas
    • Electricity
    • Manufacturing
      • Food Processing
      • Chemicals and Pharmaceuticals
      • Auto Parts, Iron, and Steel
      • Industrial Machinery
      • Textiles
      • Forestry Products
      • Cement
      • Tobacco

 Argentina’s Main Stock Exchanges

The two main stock exchanges in Argentina by size are:

  1. 1. Buenos Aires Stock Exchange
    1. Argentina’s largest and primary stock exchange
    2. Operates as a self-regulating, non-profit entity
    3. Main Index

i.     MERVAL – an important price-weighted index of the exchange

 

Ways to Invest in Argentina

There are a couple of different ways to invest in Argentine companies:

  • Through regional Argentine banks and financial firms or international ones operating in Argentina
    • Santander Rio
    • BBVA Banco Frances
    • BNP Paribas
    • BACS BANCO DE CREDITO Y SECURITIZACION
    • Argentina ETFs
      • ARGT: NYSEArca
      • EEV – emerging market ETF with exposure to various countries including Argentina
      • Through some international online brokers:
        • MB Trading
        • Interactive Brokers
        • TD Ameritrade
        • E-Trade
        • Questrade
        • optionsXpress
        • optionshouse
        • tradeMONSTER
        • Charles Schwab

Glimpse into Argentina’s Equity Market
Considered an emerging economy, Argentina attracts significant foreign investors and capital.

The MERVAL (stock index) reached an all-time historical high in January 2011. Although the index deteriorated significantly following the 2008 financial crisis, it has since risen by over 90% from its bottom.

Market capitalization of listed equities rose from $49 billion in 2009 to $64 billion in 2010 – an increase of 31%.

Capital and financing inflows via international markets related to bond issuance and new equity placements had fallen from 2.5% to 0.5% of GDP during the 2008-2009 periods.  However, there have been some notable IPOs in 2010/11, which indicates a positive outlook.