LC Latam Capital AG
LC Latam Report October 2018
The month of october was globally a difficult month – Developed markets joined in the emerging world pain this month. Only Brasil stood out – betting on the far right elected president Jair Bolsonaro and even more on his «Super Minister» Paulo Guedes. The latter announced a very liberal and market friendly economic path for Brasil.
In this environment Latam Tigers Fund returned -5,8% (USD I – share class). FX impact is -2,14%. In November the Fund recovered most of the October losses so far.
The new Mexican President «AMLO» confused international investors by his sudden decision to stop the expansion of the Mexico City Airport. This has little impact on GDP but raises questions whether policymaking in Mexico will become more interventionist and unpredictable. The stock market lost double digit in October.
In this environment the Fund Managers decreased exposure to Mexico and increased the weight of Brasil.