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Jim Slater's favourite Brazil punt

Created:
1 February 2008
Written by:
Jim Slater

In my main feature, I outlined why I think that Brazil is the next big thing for serious investors. Its middle class is affluent and growing fast, its finances are sound, its government is competent and it is fabulously rich in industry and agricultural commodities. I'm playing the Brazil game mainly via my new venture there, Agrifirma, which is a private company. But there are other ways in which I've invested - and so can you.

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To take advantage of the massive prospects for Brazil I recommend purchasing iShares MSCI Brazil. Together with my family, I own about £2m worth. These shares can be housed in a PEP or an Isa, and at the time of writing are priced at 2,958p (for their latest price, click here)

Note that the iShares can occasionally have a very wide spread, particularly when the Brazilian market is not open. If you want to buy some, it is better to wait until the spread is no more than 30p , which it is most of the time. The iShares track the BOVESPA index, which is on a multiple of under 13 - very appealing when compared with China's astronomic multiple of 43 and India's demanding multiple of 22.

Brazil looks especially attractive when, in addition to its growth prospects, you take into account its water and energy resources and its vast mineral deposits and agricultural wealth. As an added bonus, long term there should also be a gain in the currency as the Brazilian real seems to me (and, as it happens, to Warren Buffett) to be a very persuasive currency bet.

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