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Trading BRICS Stocks
The BRICS nations, Brazil, Russia, India, China, and South Africa have large and rapidly growing economies. They have a great deal of influence in regional and global affairs. These nations combined have more than forty percent of the world population and a GDP or nearly $15 Trillion. From the viewpoint of the stock trader, how can one make money trading BRICS stocks? Where do you need to go for trading BRICS stocks and what are the pitfalls?
Technical Analysis of Foreign Stocks
Going back to the era of the Cold War it was hard to figure out what was going on in either Russia or China. Much of what one knew was obtained from spy satellites and debriefing of refugees. Today both of these nations have opened up significantly to the rest of the world. However, they do not have the transparency that one sees in the US stock markets. Thus a practical approach to trading BRICS stocks, especially those of Russia and China, is to use American Depository Receipts, ADR’s. An ADR is a negotiable security. It represents the stock of a non-US company but it trades in the USA in financial markets such as the NYSE or NASDAQ. Shares of such stocks are called American depositary shares or ADS’s. These stocks trade in US dollars and pay dividends in US dollars. They can be traded like any other stock on US stock exchanges or over the counter. Because these stocks trade on US markets a trader can use technical analysis tools on a computerized work station in real time in trading these shares.
