There is a closed end fund that trades on the London Stock Exchange called the Egypt Trust and its LSE symbol is EGP. A while back I wrote somewhere that the US markets are not really leading the way as far as new products that access different parts of the world and different asset classes.
The Egypt Fund is a neat idea, not so much because it should or should not be bought but because a lot of the perceived obstacles to investing in a place like Egypt seem to have been overcome with this product. It is possible that the Egypt fund could be traded at Schwab. I was given a firm maybe on that one.
Before I started working on this, the only Egyptian stock I had ever heard of was Orascom Telecom. I was surprised to see that Orascom is only the sixth largest holding in the fund. So it is an actively managed fund. Getting good information was not easy. The Cairo Alexandria Stock Exchange looks like it is up 80% in the last year (I got this from Yahoo Finance and don't have much confidence in that number). In the same time period I got conflicting info on how well EGP has done.
This chart of EGP from the LSE shows EGP has tripled in the same time period but TrustNet.com has it up 109% in the last year.Neither the drop in the dollar nor the British pound vs. the Egyptian pound would account for the discrepancy.
One fly in the ointment here is the lack of reliable information but innovative products are starting to roll out. There is no reason you need to be the first one to own any of them but there is also no reason why you can't be the first one to know about them.
8 comments:
Readers may also be interested in TREMX, T Rowe Price's Emerging Europe & Mediterranian. The three top countries (not in order) are Egypt, Turkey (doing well and may become part of EU) and Russia. Fees seem reasonable for a fund like this.
The latest copy of THE ECONOMIST shows that the Egytian stock market since 12-31-04 is up 180.6% in local currency and 197.1% in dollars.
Looking at your chart, it's a fair match for the outline of the Sphinx.
Thanks, to you and the 1st poster who mentioned TREMX. I've been looking for a way to play the Egyptian market. If memory serves, The Economist had shown it up tripple digits for three years running.
Some magic a little petro dollar and repatriated liquidity can do, eh?
the holdings are an interesting mix
EGP trades in London (and, I believe, Luxembourg) with a USD quote. According to Reuters, closing price on 31/12/2004 was $10.50 and on 30/12/2005 was $23.00 for a 119% gain in Dollar terms - rather more in Sterling terms. So far this year, it has traded up to $31.805 for a 38% gain. Quite a run. One notes that the managers recent commentaries suggest they are no more than "cautiously optimistic" and highlight the unreasonable expectations they believe are held some individual investors (who, they say, are the prime drivers of the Egyptian market). Could this be yesterday's story?
I have held TREMX since 09/05. It's had a nice ride and even better prior. I am concerned about the 6% dip in the past 2 days. Any ideas as to why the decline?
Tony,
Just about everything tied to emerging markets has taken a big hit in the last few days. its not the fund it is the asset class.
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