William Scholes from Aberdeen Asset Management’s Global Emerging Markets team recently gave a webcast entitled: Debunking Myths of Investing in Israel: The Long Term Investing Case for Israeli Equities. It should be mentioned that Aberdeen also manages the Aberdeen Israel Fund Inc (NYSEMKT: ISL) and the webcast provided an update for that closed-end fund.
Though Israel may be off the radars of many investors and was actually upgraded by MSCI from emerging market status to developed back in May 2010, the country still has strong growth rates (especially when compared with other “developed” markets), a young population and offers the potential to invest in what Aberdeen views to be well-run companies.
The webcast also noted that Israel’s correlation with the emerging market index has fallen significantly since its removal from that index plus the country has a significant foreign reserve of dollars which helps to stabilize the currency and economy. In addition, local geopolitical risks and other issues tend to not severely impact the Tel Aviv 100 Index (TA-100) nor visitor arrivals to the country – meaning the economy is actually well insulated.
And while Israel has some anti-business policies and heavy regulations, some of the recent actions taken by the government were done to lower the high cost of living in the wake of the “cottage cheese” riots with lower inflation actually helping consumers and in turn, the overall economy.
The webcast also covered in detail some specific or interesting Israel stocks, namely property developer Azrieli Group Ltd (TLV: AZRG), machine-to-machine wireless communications product (for use in stolen vehicle recovery) stock Ituran Location and Control Ltd (NASDAQ: ITRN) and discount store chain Rami Levi Chain Stores Ltd (TLV: RMLI).
To listen to the whole webcast, Debunking Myths of Investing in Israel: The Long Term Investing Case for Israeli Equities, go to the website of Aberdeen Asset Management. In addition, check out our Israel ADR list, Israel closed-end fund list and Israel ETF list pages.
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