It is because JPM upgraded it in November. It was not exactly cheap at that time but the investment case is intact and the long term is promising. Usually, when people read recommendations, they buy the thing for an immediate gain. This failed to happen and those suckers then get discouraged and want to ''cut their loss'' as if a growing company in a low debt strong fundamental country such as Brazil can go to 0.
I bought at 13.25 yesterday and this makes me smarter than a lot of folks at JPM. Seriously, being an investment professional is a sure way to earn a wage by acting in such a way to get uncertain results. It must be easy : you may do what I say at your own risk. Now that you bear responsibility and that I am not accountable for the consequences of my recommendations, listen...
Overseas investors made 51,161 more bets on the real rising than falling versus the dollar as of Dec. 17, compared with 221,615 on Oct. 15, the most since Sao Paulo-based BM&FBovespa SA began compiling the data in 2005. With each contract worth $50,000, the net bullish wagers dwindled to $2.6 billion from $11.1 billion.
Foreign-direct investment in Brazil, which includes stable longer-term investment in factories and machinery, accumulated in the 12-month period hasn’t been enough to finance the country’s current-account deficit since January 2010, with the more volatile flows into bonds and stocks funding the gap, according to central bank figures.
FDI fell short of financing the current-account deficit by $11.9 billion in the year through October. The central bank projects that figure will rise to $15 billion next year.
“The composition of financing is shifting away from longer-term investment flows, more towards portfolio inflows,” Neil Shearing, an emerging-markets economist at London-based Capital Economics, said in a telephone interview. “It will become an increasing concern over the next year.”