Brazil has one of the fastest growing economies and the Brazilian stock market has been one of the best performing since 2000. From 2003 until 2007 the iShares MSCI Brazil Index Fund had an average yearly return of 64 percent, and through mid-2009, the fund had a five-year compounding return of 33 percent per year. Investors interesting in fast growing companies should take a look at Brazilian stocks.
The Brazilian stock exchange is called the BOVESPA and is located in Sao Paulo, Brazil. There are over 500 stocks listed on the stock exchange website. The stock index that tracks this market is the IBOVESPA. The index symbol is BVSP on Yahoo Finance.
U.S. Stock Markets
Many foreign stocks trade on the U.S. stock markets in the form of American Depository Receipts or ADRs. ADRs represent shares of the foreign stocks held in trust by U.S. banks. Investor can buy ADRs like any listed U.S. company. ADR.com will list all of the available ADRs and a search for sponsored ADRs of Brazilian stock produces a list of 132 stocks. Many ADRs are private placement securities and about 30 of the top Brazilian stock are available as ADRs to individual investors.
Invest in Brazil
The easiest way to invest in a broad cross section of Brazilian stocks is through exchange traded funds or ETFs. The iShares MSCI Brazil Index Fund, symbol EWZ gives an exposure to Brazil's top companies. New in 2009 was the Market Vector - Brazil Small Cap ETF, symbol BRF, providing investment exposure to smaller companies in Brazil.
Brazilian stocks in Brazil are valued in the local currency. Dollar denominated proxies like ADRs and ETFs are subject to currency risk as the real rises or falls against the dollar. Beware of currency effects when comparing performance of stock on the BOVESPA and their dollar counterparts.
Here is a listing of some of the top Brazilian stocks that trade as ADR's in the U.S. Oil giant, Petrobras, symbol PBR. Mining conglomerate Vale, S.A., symbol VALE. Brazil's largest bank company, Banco Bradesco, symbol BBD. Brazil Telecom, symbol BTM. Steel manufacturer, Siderurgica Nacional, symbol SID. Electric power company, CPFL Energia, symbol CPL. GOL airline, symbol GOL. Hombuilder, Gafisa, symbol GFA.