While el Merval It reached historical maximums in 2024, the Ibvespa faced a year of marked volatility. This contrast aroused the interest of investors, which began to evaluate The potential of a recovery in Brazil.
Despite an accelerated inflation period, devaluation, and an increase in the yields of its sovereign bonds, Brazil is at a turning point that could mark the beginning of a new cycle.
- Political impact and elections 2026
The 2026 elections will be a determining factor for the investment scenario. The Municipal of 2024 showed a weakening of support to the current government, which could favor the arrival of a more aligned administration with the market. Recent surveys show a slight decline in Lula’s approval, which opens the possibility of leadership focused on tax discipline and pro-investment policies.
The case of Argentina, with the rise of Javier Milei and the subsequent interest of the market for its pro-market policies, is a clear example of how the anticipation of a change of political course can trigger a revaluation of the assets of a country. Argentine investors already know this pattern.
In the short term, the performance of the most representative ETFs of these countries in the North American market continues to reflect the same trend for Brazil.
If we observe the historical evolution in a period of five years, the main American index (S&P 500) and the Argentine (S&P Merval) recorded increases of approximately 80% and 330% in dollars, respectively. In contrast, Brazil’s reference index suffered a fall close to 40%.
The Chinese market, which had shown weak performance in recent years, has begun to rebound strongly in recent weeks … in the short term, the performance of the most representative ETFs of these countries in the US market continues to reflect a little trend favorable for Brazil.
- Long -term fundamentals and global context
Beyond the current policy or prices, Brazil’s long -term recovery will depend on its foundations: fiscal and monetary policies that control inflation, promote growth and strengthen the real. The current account and the trade balance could benefit from a strong surplus driven by an increase in the production and/or price of commodities, such as grains and oil, fundamental elements for the Brazilian economy.
Brazil cannot be analyzed in isolation, but in the context of emerging markets in general. While India and Mexico have captured a strong investment flow due to their macroeconomic stability and competitive advantages, Brazil faces the challenge of recovering the confidence of international investors. Nevertheless, Its weight in the export of key commodities such as iron, soy and oil. An eventual rebound of the Chinese economy could act as a catalyst for Brazilian recovery, promoting its commercial balance and strengthening the real one.
History also plays a favorable role in this aspect. A retrospective analysis reveals that the cycle of crisis and recovery occurred between 2015 and 2017 followed a similar pattern: An abrupt fall of Brazilian financial assets gave way to a spectacular rebound in bonds and actions. On that occasion, investors who bet on recovery received generous rewards.
Finally, although risks persist, historical evidence and economic projections suggest that Brazil could be on the threshold of a new cycle. For aggressive profile investors and willing to challenge the bearish consensus, this could be the next great commitment of emerging markets.
Invest in Brazil through Cedears
CEDEARS (Argentine Deposit Certificates) are financial instruments that allow local investors to access foreign companies without the need to operate in international markets. In other words, they function as “mirrors” of the original actions, but quote on the bags and markets of Argentina (Byma).
With an increasingly wide offer of available companies, Cedears have become one of the most used alternatives by those who seek to invest with a global vision from Argentina.
What are the yields available to invest in Brazil?
ETF yield that allows you to invest in a representative portfolio of Brazil
He CEDEAR DE ETF ISHARES MSCI BRAZIL CAP ($ EWZ) It allows to enter with pesos a whole basket of Brazilian actions. It is the largest representative of Brazil in the United States, administered by Blackrock and with more than US $ 3,000 million assets under administration.
It seeks that its investment results correspond to the profitability of the MSCI Brazil 25/50 index. It invests in medium and large capitalization companies in Brazil that represent 85% of the stock market of this country.
For those interested in particular sectors, the complete list below. Those certificates whose underlying asset is directly traded on the São Paulo Stock Exchange (B3), which are distinguished from the rest that represent Adrs that are quoted on Wall Street are marked in blue.
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Commercial Director of Max Capital.
Source: Ambito
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