American Clients and U.S. Investors trading offshore
Amongst the many other categories that compose the ranks of offshoreinvestorsworld-wide, we should not forget the much abused U.S. and American traders, clients and expatriates. These U.S. offshoreinvestors and American expatriates have been very negatively affected in terms of choice by the collateral anti-commercial damage done by the Patriot’s Act which has also served to ironically reinforce the oligopoly of the handful of incumbents in the United States, namely the American Exchanges (NYSE, NASDAQ, AMEX) and three or four of the large U.S. Investment Banks currently under the cosh of the sub-prime debacle. These factors have directly or indirectly contributed to the effective banning and/ or commercially exorcism of CFDs from the U.S. (should we say “sold short”?) by the United States of America for much the same reason that spreadbetting was hit (and I use the word advisedly) by the current American Administration. The latest ruling by the WTO is quite an eye opener. Market orientated opinion makers in America are growing louder in their condemnation of these anti commercial, essentially anti-American measures (i.e. bad for the US economy).
Sitrep on changes in the trading world on the various continents
The bettingworld (yes, convergence of the two is inevitable) has changed immeasurably within the last 12 months and the financial landscape has definitely changed more radically than most traditional brokers and financial institutions currently realise; the investmentworld or, rather, the world of investment (of investment choices) is now every man’s financial oyster and it is literally, technologically there for the taking, for the ‘investing’. There are now really no such things as exotic markets: there are simply those markets that are MORE or LESS executable in terms of trading. It is as simple (or as difficult) as that! Take a look at that eternal basket case, Africa, at present on an upward economic surge on high mineral prices and aggressive inward Chinese investment. On the Sub-Saharan African continent, apart from South Africa itself, the stock exchanges are difficult to access with low liquidity which can be risky for an investor but this is improving fast in tandem with the economic growth shown by this continent over the last five years. A good point in case would be Angola, which is now the biggest Sub Saharan producer of oil in Africa, having overtaken Nigeria over the last few years. Angola’s heretofore unknown stock exchange is currently shaping up and investors should watch this space as Angola is a huge store house of mineral wealth. If they can jettison the legal hangover from their erstwhile Scientific Socialism (Communist) period and allow foreign investors to have full ownership of land, then the process would be ten times more dynamic. As it stands, this throwback to Agostinho Neto’s day in the 70’s only serves to promote more graft as disaffected foreign investors get their investments ‘squeezed then seized’. Subject to this important caveat, the Angolan markets could be very exciting indeed and the days of executing CFDs on Angolan stocks and shares cannot be that far off.
Other continents such as the Australian continent boast very mature and innovative stock exchanges and Australia is setting up a formal CFDstockexchange (will America eventually follow its lead?) and it has effectively become the gateway to other potentially more important oriental stock exchanges such as the Japanese, Chinese, Korean exchanges etc. Back in Europe, another gateway-type exchange is the Austrian Stock Exchange whose brokers are highly specialised in Eastern European exchanges such as Russia and erstwhile satellite countries now vying for a piece of the international investor’s pie with a significant stock market offering of their own. These exchanges (e.g. Poland, Czech Republic, Latvia, Lithuania etc.) are coming from virtually a zero base with a highly intelligent, highly educated populace and will outstrip growth of more mature exchanges such as the Belgium Stock Exchange (read EURONEXT in its many manifestations) over the medium term.
On the South American continent, the Brazil Stock Exchanges, the Brasil (as it is spelled in Portuguese) Stock Exchanges have been stellar performers but they have 3 significant impediments when compared to the budding Eastern European Exchanges for which reason they will not show the same explosive growth over the next 3-4 years unless they get their economic, technological and legal act together quickly: they are technologically weak in terms of online trading (segregated online sub accounts in 2007 were virtually impossible to set up); the legal investment and regulation framework favours banks and very large financial institutions; it is weighted against foreign brokers and a closed shop of Brazilianbrokers has been effectively created; this makes for very expensive operating costs for a foreign broker and a lengthy (and costly) set up
