Key insights
- The post discusses the challenges and considerations for US investors looking to invest in Chilean companies, including liquidity, transaction costs, tax implications, corporate governance, currency risk, and language barriers. While it highlights potential investment opportunities, the complexities and risks associated with investing in a foreign market, especially an emerging one, suggest a slightly negative influence on US equities as investors might divert capital to less familiar and potentially riskier assets.
Some examples of companies I'm looking at are:
SalfaCorp, SQM ADR, Forestal
Feel free to pick and choose what you answer. I appreciate any and all feedback.
-
When you're looking at Chilean companies, how do you think through going via US-listed ADRs versus getting set up to buy native shares directly on the Bolsa de Santiago? I'm especially curious how that breaks down for you on liquidity, what it actually costs to transact, and how much of the investable universe you can reach either way.
-
On the practical side, how does a US citizen actually go about executing trades on the Bolsa de Santiago? Did you end up registering for a local Tax ID (a RUT)?
-
When you're trying to build a real position in something illiquid down there, how do you go about it without spiking the price against yourself?
-
So many of the listed companies in Chile are family-controlled. How do you get comfortable that minority shareholders will actually be treated fairly, and what governance signals do you look for?
-
Do you find yourself looking to see whether a respected local value manager or activist already has a meaningful stake or a board seat before you'll commit? Or is that not really part of your process?
-
How has the administrative side of dividend withholding actually gone for you under the US-Chile tax treaty? Smoother than you'd expected, or has it been a slog?
-
When it comes to capital allocation signals in the Chilean market, things like buyback programs, what have you found you can genuinely trust as a real positive signal?
-
How do you think about peso exposure when you're holding concentrated positions for the long haul? Do you hedge any of it, or just live with the swings as part of the deal? The copper correlation?
-
How much of a hurdle has the Spanish-language side really been for you, whether it's the regulatory filings or the corporate annual reports?
-
Do you lean on specific valuation floors for downside protection in this market, things like cash-to-market-cap or deep asset coverage? Or does your downside thinking work a bit differently there?
-
What local news sources or platforms have ended up being part of your daily routine for tracking the broader market and keeping up with policy shifts?
-
Are there specific industries or business models in Chile where you think the local market structurally misprices things compared to how a US investor would value them?