January investments: which ones were unbeatable and those that lost heavily against inflation

The first month of the year concluded and left some lessons regarding what to do with the weights in times of strong inflation and negative rates. Despite what is usually thought, the dollar this time was not one of the best refuges against inflation but it was close. In this note, we tell you what the podium of investments that surpassed the price index was like despite the few alternatives and those that caused the loss of purchasing power.

According to a recent report by GMA Capital, he S&P Merval It generated a real monthly return of 12.9% in pesos (above inflation) but measured in the CCL dollar, the return was 2.9%. Even so, taking into account that it is little compared to what it knew how to earn in 2023, it was at least what allowed it to overcome inflation. The rest of the investments did not fare better and the one with the worst performance was undoubtedly the CER bonds with a real loss of 15.7% and measured in dollars of 23.1%.

The indexed securities (Boncer and Lecer) were the assets that they performed less in the month, despite having captured a good part of the December inflation (25.5%). In nominal terms, Lecers advanced only 4.1% while Boncers appreciated just 1.3%. Consequently, this asset class fell more than 13% in real terms and experienced losses of more than 20% in hard currency.

“In reality, the world showed ups and downs. Behind closed doors, The fiscal anchor did not convince, especially after the setbacks in Congress; The Central Bank’s blender pulverized both paid liabilities and depositors; and the historically negative real rates “They were an invitation to escape from the local currency,” explained the consultant.

Why didn’t CER stocks perform better in January?

In December, the CER titles They were the “star assets.” With the change of government and the imminent adjustment of relative prices, “the perspective was of nominality accelerating in the short term. This, enhanced by the effect of a low reference interest rate and the validity of the stocks, aroused an unusual attractiveness in this asset class. As a consequence, the Boncers had risen 61% in December alone,” GMA explained.

Taking this into account, “we believe that the recent poor performance would respond to a correction after the recent boom, added an expectation of a marginal slowdown in inflation compared to the December outlook. Far from providing positive returns in real terms, CER bonds continue to yield well below zero. Not even titles like TX28, with a maturity of more than 4 years, manage to provide positive returns (CER -7.9%). In the monthly comparison, the yield curve shifted upward between 1,000 and 1,500 bps (10 and 15 pp).”

In conclusion, althoughCER bonds did not fulfill their purpose, “the dollar-linked bonds “They did manage to stimulate some appetite among investors, and advanced 19.3% in the month (although they lost 9.5% in dollars).” The escalation of the exchange gap from 8% to more than 50% raised greater doubts about the sustainability of the crawling peg of 2% monthly and fueled the probabilities of a new exchange rate jump. In the case of TV25, it went from yielding 11% at the end of December to offering -13%.

Investments: how fixed terms fared

If we leave aside what happened with the titles in pesos, the fixed rate investments They were once again the worst of the month. With a mega-negative rate, the main victims were the weight holders.

While in the first month of the year the CER rose 20.1%, fixed terms gave returns of only 9.9% (-8.4% real). This picture was even more acidic for the Money Market funds, that advanced only 7.6% and experienced losses of more than 10% after adjust for inflation.

What happened to the dollar

According to GMA, the seasonality of the dpeso demand in January and The decision to keep the interest rate well below the increase in the cost of living were the factors that they put upward pressure on the CCL as well as the exchange gap that already exceeds 56%. “In this sense, if the Government were to aim for a final devaluation in order to unify the exchange rate, the spread between the free and official quotation would have to be compressed from these levels for it to be successful”