Last week I have made a study regarding high yield fixed income and found out that Brazil has the highest real interest rate in the world. Being curious I decided to look further into the Brazilian Stocks and Bonds Exchanges.
When I heard of Brazil in the past I often thought of high inflation, and an instable financial environment. After rating agency Moody’s downgraded the Brazilian economy to BB- in 1989 the consequences were far-reaching. But in the last ten years things have dramatically changed and today Brazil is Latin America’s strongest economy and on its way to become one of the most important economies in the world. The Brazilian currency Real is the most valuated against the dollar for three consecutive years and the Brazilian Stock Market rallied in 2009 almost 90%.
On the most important Brazilian Stock Exchange Bovespa investors can buy, sell and rent stocks, fonds and derivatives while the BM&F trades lifestock futures. Both exchanges have been merged recently into BM&FBOVESPA.
The spectrum of investment products is multifaceted and very well and closely regulated by the CVM (Comissao de Valores Mobiliarios).
As a non-Brazilian investor I can basically apply the same investments as a local investor, however I must appoint a Brazilian representative to be the responsible for my actions. As far as taxes are concerned foreign investors are tax-exempted unless they are living in an offshore jurisdiction.
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