Dollarization of portfolios with Cedears: appetite grows for papers of foreign companies on the Stock Market

in a state of economic uncertaintythe process of portfolio dollarization. Within this framework, each investor chooses the instrument of his convenience and one of the most chosen is being the Argentine Certificates of Depositalso known as cedears.

Last Monday, after the electoral result that positioned javier milei As the most voted candidate the country, the government decided to devalue the official exchange rate by 22%. In this framework, the financial dollars and the exchange rate blue.

What are the Cedears?

The cedears (Argentine Certificates of Deposit) are papers that follow quotes from foreign companies in global markets and what do I know subscribe in pesos -also in Dollars– but dollar fluctuations follow Cash with Settlement (CCL). The costs are the same as for trading shares in the local market and no foreign account needed.

Are instruments What are they locally operated and represent actions that are listed on foreign markets such as the NYSE, the Nasdaq, the FTSE or the Frankfurt Stock Exchange, among others. There are more than 200 available to invest.

Main attractions of the Cedears

• They are fractions of titles, therefore, they can be buy with low amounts.
• They are one more instrument when it comes to diversify portfoliosoperating in pesos but linked to an asset in dollars.
• They allow access to international companies without opening accounts abroad.

Which Cedears do Argentines choose?

The cedears that usually occupy the ranking of favorites of Argentines with those of S&P 500 (SPY), Coca Cola (KO), Vista Energy (VIEWS), Manzana (AAPL), Free market (MELI) and DAY (Dow Jones Industrial).

This week in particular, the most in-demand Cedears were those of the ETF’s S&P 500the one of Coca Cola and the one of Manzana. Damian VlassichSenior Equity Analyst at IOL stated that “this election could be interpreted as a value search by investors and conservative alternatives of low volatility“.

Along with the Cedears, demand for Argentine shares grows

From IOL they also clarified that Argentine variable income assets they are showing soliditydespite the context of uncertainty unleashed from the electoral results and in a context of high inflation.

In that sense, Vlassich explained that in a context in which the CCL dollar already uploaded a 115% so far this year, the MEP did it 101% and the inflation record a cumulative rise of the 60.2% in the first seven months of the year, the Merval index has been surpassing all the other variables, by increasing 185% since the beginning of the year. “Therefore, it could be said that, despite the noise and instability, Argentine assets will continue to be a hedge in this volatile context“, he added.