One good way to play Brazil is via BRF, IMO. Unlike most Brazil ETF's, that one gives you very good exposure to consumer discretionary companies with 50%+ of their revenues coming from Brazil. I own a few Brazil companies, most notable ones like MRV and PDG in real estate because they are benefiting from the latest government '1 Mil home' program... But overall, home prices are going up there for the following reasons.
1) Brazilians do not really invest in the stock market. The mentality for decades has been a focus on owning homes as a form of wealth. This may someday change, but it is definitely true right now.
2) The country is experiencing an economic boom which is drastically improving the resident's economic power. More than 20 million (10% or so of the pop) have entered the middle class in the last few years. Credit and loans are MUCH more available than even 5 years ago... I saw tons of it available for car/consumer/house/etc loans a few months ago when I was there.
Given those points, I believe that the real estate sector in Brazil will outperform other sectors as a good chunk of this newfound wealth will go into housing. From friends who invest in land/housing, I can tell you that prices have been jumping the last few years...Thankfully it has the economic 'boom' to sustain it, otherwise I would believe it to be a bubble. I think the sector has a LONG way to go and will remain hot for years.
Anyhow, i'm very bullish on real estate in Brazil as you can see and have invested accordingly. BRF is a great way to play everything though, if you do not have the time/knowledge to make a more specific Brazil-portfolio. It also gives you exposure to the Real currency, which I believe will outperform the dollar.
-Fernando - Born in Brazil
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