Fantastic Funds

Yesterday outages took down four brokerages: VanguardRobinhoodTD Ameritrade, and E-Trade. The official cause is too many orders. The real cause is excessive caution which requires calls to confirm trades.

Today we started a new month which led to all sorts of moves, particularly closed-end and exchange-traded among the funds we cover. Today I will mainly focus on funds because I tend to neglect them for more exciting individual stocks.

Latinas and Emergers

*One single Mexican MNC, Orbia Advance Corp SAB, still using its old ticker symbol MXCHF, today rose a whopping 82.2% to hit $3.99. Note that it was as high as $7 in the summer of 2019. It offers a dividend of 20 US cents per share, nearly 5%, payable Friday and is a fave among emerging market funds.

*HSBC raised Cemex to hold from reduce. CX is up 2.2%.

*Mexican REIT Fibra Uno is up 6.44%, in my IRA. FBASF

*Herzfeld Caribbean Fund is beloved by our oldest and wisest contributor, who has to remain nameless because he still advises a fund or two. He considers Floridan Tom Herzfeld, its creator, as a leader in exotica. He certainly lives up to its ticker symbol, CUBA, with ownership of $165,000 of pre-Castro Republic of Cuba 4.5% bonds of 1977 and shares of Cuban Electric Co paper. The trouble is that Herzfeld no longer acts as a major source of fund discounts for publications like Barron's which now even omits the Net Asset Value of CUBA. The reason is that it is heavily into tourism and cruises, a major Florida business. It also owns some stock we like, like Mexican Cemex (CX) and Panama's Banco Latino-americano de Comercio Exterior (BLX). But even if CUBA is at a discount (who knows?) I still prefer to own these outright. BLX rose 2.4% today and CX 1.7%.

*Today Wall St. got into emerging market funds and others trading at huge discounts, in part because the largest of these funds are run from Britain, closed for the August Bank Holiday. Here are some gainers: Templeton Emerging Markets Fund, EMF, 1.11%; Western Assets' counterpart, EMD, up 1.54%; Aberdeen Asia-Pacific Income Fund FAX, up 1.69%; Aberdeen Global Income Fund FCO, up 3.05%; and Canadian General Fund up 0.54%. Once again while there was not much visibility on discounts in Barron's this week, the funds which were bought were ones with posted data there.

*Despite its whopping discount from NAV of nearly 25%, New Ireland Fund (IRL) fell by 0.46% today as IRL's defenders were on holiday. That's the one I bought at $8.65.


*SPDR Gold (GLD) rose 0.5% after the yellow metal hit $1996.9/oz. Our gold share, Kirkland Lake, fell ~1% however.

*Antofagasta of Chile rose 0.5% despite London being its primary trading site. Copper is rising, a classic signal of better days ahead so also ANFGF.

Tech & Tel

*British Vodafone did another tower deal, with Bharti for its Indus (India) tower sub. VOD transferred 760 mn new Indus Tower shares to Bharti for 36.7% of Bharti stock worth ~$2.05 bn. It will sell 11.15% of the shares for cash. Another 3.7% of the VOD shares go to Providence Equity Partners, owner of 4.85% of the Bharti outfit. VOD needs cash badly but India has now given it 10 years to pay back taxes.

*Mercado Libre, the Latin internet sales giant, will do a $350 mn buyback program. MELI had doubled year-to-date. Its share gained over 4% today.

*BCE is Canada's exclusive vendor of the Samsung Z-fold 5G cellphone. BCE fell on the news.

*Nintendo (NTDOY) gained 4.84% on realization that gaming is not going to stop just because people are no longer in total lockdown. The share was recommended by Abhimanyu Sisodia, our juvenile reporter.

*The German government is investigating the collapse of Wirecard, in part because Bafin, the market regulator, tried to penalize those who warned that it was a fraud, like the Financial Times. They were charged with illegal short-selling.

*Naspers (NPSNY) gained 3.4% today in South Africa while its Dutch clone Prosus (PROSY) rose 3.55%.

*Qualcomm, which we bought to get our hands on an Israeli startup it owns, was upgraded to equal weight from underweight by former bear Wells Fargo today. Being American QCOM is a bonus stock.

*Cognizant (CTSH) bought Microsoft's (MSFT) cloud specialist site 10th Magnitude which will become part of CTSH's Microsoft business unit. Price was not revealed. It helps shift platforms to the cloud, something your editor plans to do after we get our website up and running. CTSH is a US bonus stock.

Oil and Energy

Both oil and natural gas output in the US resumed their rise in June, up 10% and 1.6% respectively according to the Energy Information Administration

*Dutch Antillean Schlumberger Ltd (SLB) sold its North American pressure fracking unit to Liberty Oilfield in return for 37% of the latter's stock, making it the largest owner. It bought the fracking unit back in 2017 for $430 mn under a prior CEO. Q2 revenues more than halved from prior year. SLB fell 1.3%.

*Penalized yesterday for a secondary offering of 88.5 mn ADRs, today the market thought better of NYSE - NIO which rose as much as 5%. China's electric vehicle maker is our top performer today.

*BP plc lost 0.45% here while London was closed; Royal Dutch Shell B (RDS-B) lost 0.36%.


*Astra-Zeneca (AZN) stated after hours yesterday that its research into covid-19 vaccine AZD “will meet the stringent requirements of regulators”, unlike some other offerings. Some 50,000 volunteers will get the Vaccitech weakened adenovirus incorporating coronavirus spike proteins. This is a call to beware the rush to jab like Russia's “Sputnik” vaccine, which was tested on fewer than 60 volunteers before its launch. Its stock fell 1.2% today; caution be damned.

*Dr Reddy's which is both a generic drug maker and Indian gained over 1.23% today. RDY.

*GlaxoSmithKline (GSK) dosed the first patient in its phase III trial of 5:1 meningitis vaccine ABCWY.

*Morgan Stanley rated Novartis as overweight and NVS rose l.1% today.

*So did its cross-town rival Roche, but it only gained 0.4%. RHHBY got FDA ok for its HIV tests.

*Teva (TEVA) fell another 3% today as it became a target of the House Oversight Committee investigation of drug pricing, along with AZN, BMY, LLY, JNJ, NVS, SNY, and others. Teva fell the most. It beat forecasts in the last 4 quarters but only one analyst rates it a buy, Ford, which upped it last week.

*High-flyer Compugen (CGEN) fell another 1% today.

*Zymeworks (ZYME) fell 0.9% because we are ahead 144% and it is scary. Martin Ferera of Canada picked it.

*Eisai (ESALY) of Japan is on a role, up 1.66% yesterday and another 1.66% today. It is working on Alzheimer's, a key need not only in Japan.

*High-flyer Beigene (BGNE) lost 4.4%. It is China's most westernized drug maker.


*AIG Asia (AAIGF) rose 1.72% as British bears were sidelined today.

*Hang Seng Bank (HSNGY) gained yesterday but didn't trade here today.

*Swedish Investor A/B (IVSBF) gained 0.8% on no news. I confirmed that it now only owns 18% of troubled EQT after it spun off the fund. So this may just be catch up.

*Mitsubishi (MSBHF), which I bought Monday before Warren Buffett announced his purchase of the 5 leading Japanese financial groups, gained 0.7% so far now that it is a Berkshire idea. It turns out that the Buffett purchases were made over the course of weeks, but only announced Monday, so I cannot really claim to have been copied by the Oracle of Omaha, as stated yesterday.

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