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Top 10: The best Argentine investments of 2024

Top 10: The best Argentine investments of 2024
Top 10: The best Argentine investments of 2024

2024 has been a particular year for Argentine assets, with inflation far exceeding that of the dollar.Which assets performed best in pesos? And in dollars?

I am going to share a table, which shows 2 types of returns: in pesos and in dollars.

  • UVA Fixed Term: It is the star investment of the first half of the year. What is it? It is a fixed-term deposit that generates interest at a fixed rate and a variable component, which is the UVA, which reflects the evolution of inflation. As this was very high during these 6 months, it managed to capture a return of 126.1% in pesos. And it had a return of over 60% in dollars, since the free exchange rate rose only 40.1%.
  • Boats ($): The bonds are bonds that pay a fixed rate, predetermined in advance. They had a return of 110% in pesos, which is equivalent to 49.9% in dollars.
  • USD Sovereign Bonds: Sovereign bonds accumulated a rise of 97% in pesos and 40.6% in dollars during the first 6 months of the year. Some examples are the AL30 and AL35 bonds.
  • Merval: The Merval stock index is having a great year, with a return of 73.3% in pesos and 23.7% in dollars.
  • Boncer: CER bonds are a financial instrument that offer returns tied to inflation. They had a yield of 45.5% in pesos and practically 4% in dollars.

Inflation has been 79% in the first half of the year. And only three assets (UVA Fixed Term Deposits, Fixed Rate Bonds in pesos and Sovereign Bonds) have had positive returns in pesos in real terms, that is, adjusted for inflation.

How has the dollar fared? The Settlement Dollar has risen by 40.1% during the first half of the year.

Investments such as the FCI Money Market, Dual Bonds ($) and Dollar-Linked Bonds have shown negative dollar returns, reflecting a worse performance compared to the mentioned options.

The worst asset in the ranking? The official dollar, due to the 2% crawling peg, is increasing by only 2% per month, due to government policy. Measured in CCL dollars, it has fallen by 19.5% in the first half of the year.

Let’s look in detail at the two main assets: stocks and bonds, through the Merval in dollars and the AL30 bond.

Investments2.png

Investments3.png

They have had a great year, with an increase of more than 23% and 30%, respectively. Although it is worth clarifying that, since April, they have not been able to reach new highs.

Something remarkable is what happened after the Bases Law. Is Argentina going through the famous adage of “buy with the rumor, sell with the news”? It is very likely: the law was passed and stocks and bonds fell. That must be taken into account, especially after the rise that the Argentine stock market and bonds had been experiencing since Milei’s victory.

Is this a long-term trend change? No, for now the trend is still bullish. We are just in a correction zone.

Let us remember that Argentine assets move with great volatility. They may offer juicy returns, but they are still very risky.

If you want to know more about investments, I invite you to visit our website: www.clubdeinversores.com

Note: The material contained in this note should NOT be construed in any way as investment advice or a recommendation to buy or sell a particular asset. This content is for educational purposes only and represents only the opinion of the author. In all cases it is advisable to seek professional advice before investing.

Source: Ambito

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