I found this article on MarketWatch about investing in Central and Eastern Europe. In the article there was a mention of a company called Telefonica O2 Czech Republic. It trades in London with ticker TECZ.The article talked about the big energy, bank and telephone companies as ways to invest in emerging markets (a point I have made a few times as well). About all I learned from the article about TECZ is where it trades and that it yields 8%.
The info in the article was enough for me to want to learn more about the company and maybe buy in at some point. Before I did any research I called Schwab to see if it could be traded or not--the answer was no. Since I can't buy it there didn't seem to be much point in doing any further research.
While markets are opening up it seems as though access for US based investors is not quite keeping up. TECZ trades on the London market for Pete's sake but because it is a GDR, no dice.
I expect things will have moved along much further five years from now but for now things seem to be moving slowly. Direct access to Iceland is not possible because of a lack of custody agreements needed to facilitate trading. In the last year the ICEX-15 is up almost 45% compared to 20% for the S&P 500 with no US buying. There are many markets offering diversification and high returns that are not available. Consider this post to be a rant about the issue.
To be clear I am not advocating loading up on frontier/emerging markets but I am saying it would be nice to have more choice for the small portion I allocate to the space.
I am not sure if TECZ is THE big phone company or not, although you can click here for the company website.
6 comments:
Roger - i'm guessing with your biz you are tied up with Schwab ... but you might want to check out Interactive Brokers. I have used a lot of brokers and IB has the best access - albeit not complete - to many foreign markets.
Todd
O2 in Czech Republic is the biggest telephone company. You can get much overview and almost real time price at www.akcie2000.cz or www.akcie.cz . The Czech market is steadily growing from 2003 and many millionaires have been made by just buying and doing nothing.
You could try an offshore private bank. The fees may be higher, but you can get access by having the bank hold the securities for you in their name. Sometimes being an American citizen has its disadvantages.
re offshore, I have an offshore account in Iceland. While I am glad it have it the hassle was brutal, it took months and months.
re IB, Having the Iceland account and my HSA at Options Express is already pushing it with my colleagues.
thanks for the info and links on TECZ.
Roger,
My hats off to you. I have no expectation that I could accurately identify and invest in single stocks of emerging and frontier markets.
My solution is country or region specific funds.
One I like (and own) is CEE, which owns several Czech stocks, including Telefonica O2.
http://www.germanyfund.com/pdfs/CEE_032807.pdf
To anyone interested in Eastern European Funds, there’s a opened ended fund called “Metzler/Payden European Emerging Markets” (MPYMX). This is a small fund run by two financial firms, an American firm called Payden & Rygel, which has $54 billion under management. Also a German firm called MP&R Ventures, an affiliate of a large Frankfurt financial institution with €20 billion under management. The fund is not widely known, doesn’t advertise, has just 60 million in assets, is subsidized by the parent firms and has an expense ratio of 1.25% after a waiver (but only 1.5% even without a waver!) There is no 12b1 Fee! Performance is excellent, better than “Central Europe & Russia Fund” over the last year.
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