A 37% return from a Latin American stock market boom

Ay caramba! as they say in Tijuana (and Springfield).

My punt on Latin America paid off last year. The Invesco Perpetual Latin American fund - my only investment last year - returned 37% in 2007.

So why the boom? South Americans have been flogging their copious reserves of copper, zinc and the like to the highly industrious Chinese who, in turn, have kept the world economy afloat. It is also enjoying a rare period of politicial stability and genuine economic reform.

That's part of the story - demographics are important for me on investment decisions - and Latin America has some interesting stories: Mexico has a youngish population and lots of women entering employment; Chile has one of the best funded pension systems in the world - one of Pinochet's better legacies - and the prospect of a generation of pensioners awash with cash.

Respected fund picker John Chatfield-Roberts helped confirm my choice last February. I'll be catching up with him before making any decisions on this year's Isa (and reporting on this blog what he says).

My gut instinct at the moment is to continue to avoid Western economies which I think face a slow-burn bust and staying with First State Asia Pacific and Jupiter Emerging European Opportunities, and probably topping up a little more on the jaguar economies of South America. It's a high-risk strategy.

You can find the best advice on picking the right investments here:
>> How to pick the best Isa

- Andrew Oxlade, Editor, thisismoney.co.uk

> My Far East child trust fund selections
> A 40% return on a child trust fund
> My 59% return in a year

                     Invesco Perpetual Latin American returns Source: Morningstar

Comments

[LD]

Just a note, the fund Invesco Perpetual Latin American invests 2/3 of its assets in Brazil, which is today the strongest emerging market of the world.