There are four basic options for a foreign individual to invest in Brazil

1) Investing in ADRs of Brazilian public companies that are listed on the NYSE.

2) Investing in Brazilian money market funds through a Brazilian bank.

3) Investing directly in Brazilian companies through a Brazilian brokerage firm.

4) Investing in Brazilian real estate.

In this article I will d iscuss the first two items in the above list. I will write about the

others in future articles

The CPF Number

If you are not a Brazilian citizen or do not have a permanent visa to live in Brazil

the last three of the above options require you to acquire a CPF number from the

Investing in ADRs of Brazilian public companies that are listed on

This option is the simplest. It only requires a brokerage account with an American

firm such as Merrill Lynch. Most of the large Brazilian blue chip companies have

ADRs that trade on the NYSE. You can go to (www. adr.com) and see a complete

list. You can also go to (www. yahoofinance.com) and by typing in the symbol for

any of these companies, get a quote and also access the news group for the

stock. Yahoo news groups are an excellent source for links to information about

these companies. You can also find a link to a company’s official web site at adr.

com or yahoo finance.

Investing in Brazilian money market funds through a Brazilian

The simplest direct investment in Brazil is through a bank money market fund.

Money in Brazil is very expensive. This means that your cash can earn a high rate

if interest o n Treasury Bonds or Bank CDs. Current rates are about 16% per

year. The way to make this type of investment is by opening a bank account with

a Brazilian bank. Once you have funded your bank account the bank can offer

you an assortment of money funds. These funds are very liquid. You can put

your money in one day and take it out the next if you wish. There are no

A strategy that an American investor with a brokerage account in the US

could use with a Brazilian bank money market fund is illustrated by the

following example.

A US brokerage account with a value $200,000.00 has an available margin

withdrawal of $100,000.00 If the investor were to withdraw the $100,000.00 from

his brokerage account and invest it in a Brazilian money market fund he could

increase the yield on his total funds by half of the difference between the margin

interest rate and the yield on his money market investment. In 2005 US margin

rates were about 6% and Brazilian bank money market rates were about 1 9 %.The

difference, 13%. would accrue to the investors account. Also the 14% devaluation

of the dollar against the real would accrue to the investor’s account giving him a

total gain of 27% or $27,000.00 on his $100,000.00 investment.

If the investor had the $200,000 in the DJIA, his result for the year would have