2019’s rally in Colombian equities has earned them a spot at the top of the world’s best performers.
According to Bloomberg, the Colcap index is up 29% in dollar terms in 2019. Despite this year’s progress, Colombia’s benchmarks still remain more than 20% below its 2010 levels.
According to Carlos Enrique Rodriguez, head of equity research at Bogota brokerage Ultraserfinco,
“Some stocks that were ‘excessively discounted’ after a heavy sell-off last year have returned to levels that are much more rational”.
Corporacion Financiera Colombiana S.A. has led the recovery, returning 71% in dollar terms. Meanwhile, the nation’s biggest banking group Grupo Aval Acciones y Valores has enjoyed a 42% return.
“This year’s rally may get more fuel from upcoming changes to pension-fund rules, under which more contributions from younger workers will be channeled into higher-risk funds. This will result in about $370 million per year of extra equities investment per year, according to a study by JPMorgan.” (Bloomberg)