Report Card: BlackRock Latin American – be greedy when others are fearful?


#1

Originally published at: https://whichinvestmenttrust.com/report-card-blackrock-latin-american-be-greedy-when-others-are-fearful/

Could Warren Buffet’s famous adage apply to one of the most unloved areas of the stock market? BlackRock Latin American Investment Trust (LON:BRLA) has made a concerted effort to attract new investors and close a stubbornly wide discount. I’ve been taking a look at recent performance as it announces interim results, and casting a contrarian…


#2

The issue I have with this trust is it’s way too volatile. Now might very well be a buying opportunity but how will I know when to get out in time? because this isn’t a trust you can buy and hold because once it goes up, it will eventually go back down.

I prefer to get my LatAm exposure from a more general EM trust, where the manager can decide when to invest in LatAm and when to take your money off the table again.

No doubt this might appeal to some momentum investors (no not the Jeremy Corbyn lot), or even value investors but it might be too volatile for them too.


#3

I take your point @smithy101 but I have a feeling that this might actually be bit of a buying opportunity here. I don’t for one moment think that Blackrock Latin American is something to hold and pass on to your children but I think this could produce good returns over the next could of years.


#4

I think one is always blindsided in these types of investments. I find it easier to pick the point of entry and never get it right on exit. Either go in for the short-term and be nimble (hard to continually repeat this style successfully) or just buy when down and leave it to your grandchildren! The developed world will always treat EM as a high risk investment (whether trade ties are broken or not) and pull out their cash en masse, and very fast, for varying reasons, leaving you high and dry. Personally, I’m done with country specific investing, and sector specific too (hence my comment about Polar Capital Finance, and would opt for a more generalist approach across the whole EM. Of course, this is a continent not a country but it behaves the same. Why not let a team of dedicated researchers, say JPMorgan, do the when and where for you!


#5

Yes you are so right. I found myself reading your post there @james_pigott repeating yes, yes, yes.

Thanks for sharing your insightful opinion.


#6

:blush: you are too kind!


#7

Yeah I tend to agree with you there @james_pigott. I am sure this probably is the right time to buy BlackRock LatAm but I’d own it for too long and not sell out of it in time.

I do like the BlackRock Frontiers trust though, great performance there though it can be volatile.