Despite the decline in alternative dollars in recent days, for retail investors fixed terms in pesos this year yielded more than bets on the dollar.
While parallel dollars are up 71% to 73% on the year due to rate hikes, traditional fixed terms returned 80%, while UVA fixed terms, which adjust based on the price index, they rack up 91%, almost on par with inflation.
Economist Juan Pablo Albornoz, of the consulting firm Invecq, details that if someone put $100,000 on January 1 of this year into a traditional retail fixed term and it automatically rolled over when it expires today, they would have $180,683, with a yield of 80.7%.
Those who bought a blue dollar at $206 on January 2 instead took $487, which today is trading at $172,000.
The one who invested the 100,000 pesos in cash with cash, took $471 and today has $165,000.
While in the MEP dollar, the person who bought US$507 today has $173,000.
Albornoz points out that the situation was different for wholesale investors. “It should be noted that this is far from the reality faced by many companies with large cash surpluses, where beyond the guaranteed minimum rate set by the BCRA, many entities have not taken 100% of forward balances because at certain times they did not have to match those liabilities with“.
Behind the profit in pesos obtained by the retailers there is the rate hike ordered by the Central Bankwhich in September brought the reference rate to 75% per annum and kept it at that level to encourage placements in pesos.
“In part, one of the main reasons the BCRA raises rates is to generate something so-called interest rate speculation which temporarily discourages the demand for dollars due to the opportunity cost of higher yields in pesos,” sums up Albornoz.
They indicate it from the financial broker GMA Capital The most profitable investment of the year was the Merval, with a return of 130% in pesos and 37% in dollars.
follows him fixed-term UVA, which as at 26 December accumulated a yield of 90.6%, 1% more than inflation.
While the CER bonds gave 88.9%in line with the inflation for the period and with a gain of 12.6% in dollars.
The rest of the investments listed were below inflation. The GMA survey ranges from the private Badlar rate, for wholesale deposits, with a balance of 67.8% and a red of 11.7% on prices, to global bonds in dollars, which returned 48% , with a real loss of 21.2%.
What will happen in 2023
For Ignacio Morales, Financial Business Analyst at Wise Capital, the US rate hike scenario coupled with the difficulties Argentina will face in paying off its debt in dollars, “makes long-term holding of hard currency sovereign bonds impractical. It is essential to move quickly towards the primary fiscal balance, otherwise there will be difficulties in going to the capital market and facing the maturities operating from 2025″.
Morales points out that although dollar bonds have risen a lot in the last two months, “parities are still at low levels. In 2023 they are eligible for an electoral swap, in case polls indicate that the opposition will clearly win against the ruling party. But this “It is only valid as a short-term opportunity and for risk-loving investors. It is not an asset to have in your portfolio thinking about the medium and long term”.
Among placements in pesos, “the high rates of fixed-rate bills (average TEA 101%) make the yield better than that of a fixed term (TEA 97%) and are positive in real terms,” Morales recommends. “The CER investment is positive if we focus on the short end of the curve, especially the Boncer TX23 maturing in March.”
As for the Merval, “bullish rally in local equities may be nearing its end, when they got back in line with inflation. It would be good to take profits and look at the market from the outside, especially if future movements are in line with inflation, it would be convenient to be positioned in short fixed income instruments,” says Morales.
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Source: Clarin
