I just saw in the most recent Economist that the Athens Stock Exchange has outperformed ANY other stock exchange anywhere in the world since the beginning of the year! Over 125% in local currency and over 100% in US dollar value! Any thoughts out there of what is the driving force behind this performance?
As an Acive Investor in the ASE for the past couple of years, here is some of the reasons (at least to what I believe) for the Exchanges high rate of return:The stock Market in Greece has been very active the past couple of years with many private companies going public. There were few companies to trade in the past and very few people with knowledge of the Stock Market. Greece up to a couple of year ago would give you over 20% interest on your savings account and that alone was a very good investement. When Greece was forced to meet the Europeans rates (Interest,GDP,DEBT,etc..), the interest rates started to tumble from as high as 25% to a low 8% approx. This sparked an interest in new investments and therefore people staring to look into the Stock Market.All of a sudden, people noticed that Bank Stocks were doubling/trippling/etc..., Mutual funds were and still are giving you 200% returns a year. Well, everyone and their Mother was selling the farm to put their money in the stock market without even nowing how this game works. This along with a Strong Growth in the Greek Economy (inflation rate has dropped to record lows 3%, Debt has fallen, CPI down, etc...) and the pour of money into the Stock Market from Cash Accounts has made the Athens Stock Market currently the Best Market (from a rate of return) in the World.I believe that the Market will still give great returns for another year or so.I hope this helps a bitIf you are interested in any Stocks or Mutual Funds that have given more than 200% return YTD, let me know.yianis
The Athens, or sofocleous stock echange is headed toward colapse. Nearly anyone who has some cash lying arround has invested it in the market. This out of control investing is what the government hopes will keep it in power as it also hopes that the rise will last until after the next election.Looking at real value, on the whole, the economy is performing quite well BUT.Remembering the reasons behind the US crash at the beginning of the century, one thing is clear.Whoever gets their money out of Greece before the last person invests is going to stay rich and whoever leaves their money in will get burned.Was it Rockefeller who pulled out of the NYSE the day before the crash because the guy posishing his shoes asked him what to invest in?Don't get me wrong, I love Greece but if you've made money on the stock market there, the only way you'll see it is if you get out in time. It is a timebomb.Unfortunately, most Greeks believe that the Olympic Games will be responsible for growth in the market. Ignorance. A one off tourist and public spending boom will be followed by a property crash, High inflation, economic stagnation, sky high interest rates. Need I go on?Only the well informed will make the profit, making sure that the information deprived are wrangled out of their wealth.How about an earthquake!
I don't neccessarily agree with you as far as the ASE being a timebomb. If you notice lately (past few months) the Index has been very stable and sitting around 5500- 5600. The Market has already slowed down. I definetely agree that the days of 100-200% gains are most likely over, but there will be NO colapse in the market. Will there be a downward correction ? Who knows, maybe. Same question can be posed towards the NYSE or other markets.I do believe that every Tom,Dick or Harry has invested in this Market based all on speculation and nothing else, but a lot of people have made tons of money and have already cashed their profits in. The Greedy always lose in the long run no matter what Market you are talking about.As far as Greeks believing that the Olympic Games will be responsible for growth in the Greek Economy, well, the current Growth is Great right now and the Olympic Games can possibly accelarate the Growth, but Greeks are not depending on the Olympic Games to take them into the new Millenium.I go there 1 - 2 times a year and trust me, the Olympic Games mean nothing to them as far as Growth is concerned, it's more of recognition and Pride.The Economy in Greece is booming and there's lots more room for Growth.You say that High Inflation,economic stagnation, sky high interest rates will follow. I don't understand where you get this information from, is this again speculation ?Greece will enter the EMU next June and in order for them to get in and stay in, all of the above factors will have to be controlled and regulated. So if any of the above will to occur, well you'll have to include all of the countries in the EEC.Anyway, the only advice I would have for any potential investor in the ASE would be to exercise caution and Diversify. There's nothing wrong with a little greed but know when to get in and when to get out.Happy Trading !
I'm Greek too!Anyway, the information is based on sound macroeconomics. Interest parity theorem tells you about inflation, related to interest rates, put in your knowledge about greek public spending, the decline of the tourist industry in the last 3 years, how disproportionately high the growth in the stock market is in comparison with the economy, the level of corruption, instability in the region, anti-US feelings, the ageing of the population etc.Combine all of this and you get a pretty explosive mixture. If you believe that the shares offer fair value - then buy them by all means but please tell me how you evaluate them.Greece remains an emerging market, and to believe that there won't be many a crash-bang in the ASE in the next 15 years would be verging on the foolish!Hell if like me you've made 500% on $25000 in three years on the thing, wouldn't you get out and enjoy it?Cheers,Christoforos
You speak like a typical Greek who definetely does not live in Greece. All the data you provide: how disproportionately high the growth in the stock market is in comparison with the economy, the level of corruption, instability in the region, anti-US feelings, the ageing of the population etc.I definetely hear a Non-Greek Citizen talking.Anyway, you must be a rich Greek (500 % on 25,000), why do you spend your time on this board ? I also love your prediction:and to believe that there won't be many a crash-bang in the ASE in the next 15 years would be verging on the foolish!Wow ! Are you a prophet ? That's amazing !!I bet you that the NYSE will have a crash in the next 50 years ! Mark my words ! (LOL)Anyway, enjoy your new found wealth (LOL) dude and when your ready to talk serious let me know !!Don't waste my time with BS !!!YianisWhat's the deal with Berry ?
I just saw in the most recent Economist that the Athens Stock Exchange has outperformed ANY other stock exchange anywhere in the world since the beginning of the year! Over 125% in local currency and over 100% in US dollar value! Any thoughts out there of what is the driving force behind this performance? note: this data does not take the 20% Drachma devaluation of 1998 that select sources knew about days before the announcementSo fools can decide for themselves, here's the underlying economic data for Greece, taken from the ASE fact book.I will not enter into a flaming match with Yannis, to preserve your ears but I will offer a word of friendly advice - one fellow Greek to another. We do each other no favours through arguing in such a manner. We are part of a very proud nation but pride doesn't mix with the coldness of the market, just as emotion has no place in trading. I wish you very successful trading. There is much to be learned from these boards, use them well.FACT BOOK 1998 II. ECONOMIC REVIEW THE GREEK ECONOMYIn 1997, fiscal policy accomplishments surpassed all expectations as public deficit decreased by almost half percentage point compared to 1996. Although primary outlays exceeded by GRD 111 billion the budget set out in the beginning of the year, interest savings resulted to a value of total outlays being less than GRD 127 billion of the budget estimations. GDP increased by 3.5% in 1997, compared to a 2.5% increase in 1996 Chart 2.1. High economic growth was supported by an increase of 18.2% in public investment and by a rise in exports of goods and services by more than 3.5% for the first time since 1994. Inflation decreased to 5.6%, on average levels, as opposed to 8.5% in 1996 and 9.3% in 1995. End of year rate went down to 4.8%, almost 3 percentage points lower than at the end of 1996 Chart 2.2. General government deficit fell to 4.2% of GDP, due to the high primary surplus of 4.8% of GDP in the Ordinary budget. Public deficit defined by the Maastricht criteria fell to 109% of GDP for the first time since 1992 Chart 2.3.On the balance of current account, deficit increased in the first seven months of 1997, compared to the respective period in 1996, as the 5.2% increase in the surplus of the balance on invisibles failed to compensate for the increase of 6.4% in the deficit of the trade balance. However, it must be noted that the existing methods underestimate export activity towards the Balkans, which resulted to an exports increase of approximately 13% in 1997, compared with the official figure of 1%, estimated by the National Statistical Service. In 1997, unemployment decreased, as 62,000 new jobs were created. Temporary estimations place unemployment rate to less than 10% in 1997 Chart 2.4. On the monetary side, the «hard drachma» policy of last year was sustained. The Greek drachma exchange rate with respect to ECU remained almost stable in 1997, but the drachma slightly appreciated with respect to other European currencies Charts 2.5-2.7. The decreasing trend of the interest rates in the first nine months of 1997 was disturbed by the crisis in the Asian market which forced the Bank of Greece to engage into actions to alleviate the currency pressures Chart 2.8. Interest rate on one year treasury bills in October went up to 11.3%, as opposed to 9.5% in September. Still, the average interest rate in 1997 remained low at 10.3%, compared with 12.7% at the end of 1996.High interest rates shifted funds to bank deposits, causing M3 to increase by 9.5% in 1997, exceeding by half percentage point the target set out in the Convergence Program Chart 2.9. On the contrary, the rate of increase of M4 slowed down to 1.6%, as some of the treasury bills which expired at the end of October were replaced by government bonds of a longer term. Economic prospects for 1998 are encouraging as 12 public corporations are expected to be privatised in the period 1998-2000. Furthermore, it lies among the priorities of the government to strengthen the involvement of private companies to major construction works, increase their participation in the banking sector and restructure employment relationships. The inflation target of 2.5% by the end of 1998, raise pressures for restriction of wage increases to 3-3.5% during the year. Meanwhile, economic growth will be sustained as the size of the public investment program is estimated around GRD 2 trillion in 1998, compared with roughly GRD 1 trillion in 1996 and GRD 0.7 billion in 1993. The average GDP growth over the period 1995-1999 is expected to amount to 2.2%. Greece is expected to have fulfilled fiscal targets for EMU by 1998 and monetary targets by 1999. Furthermore, the award of the 2004 Olympic Games may be seen as «an international vote of confidence in the country's prospects», as stated in the Financial Times. An independent public company has already been set up to carry out and coordinate all necessary actions. The budget is set at USD 1.6 billion and the majority of funding will come from sponsors. Government borrowing will be sustained to 1% of GDP, as stated by the Governor of the Bank of Greece.ECONOMIC COMPARISONSThe majority of Euro zone countries, namely countries joining EMU from 1999, experienced tight monetary and fiscal policies in an effort to adjust their economic fundamentals to the Maastricht criteria. In terms of GDP growth, Greece remained in 1997 above the EU average. Production increase, stimulated by public investment, exceeded the community average and reached 2.5%. In Germany, real GDP growth accelerated in the third quarter of the year, largely driven by an exports increase of 11% and by a high level of investments. In France, GDP is expected to increase by 2.3% in 1997, given the increase of 1.9% in the first semester of the year. The restructuring of industrial activity in Italy is expected to increase GDP by 1.7% in 1997, as opposed to 0.7% in 1996 Chart 2.10.Unemployment decreased in 1997 in the majority of European countries, with Greece's unemployment rate of less than 10% being below European average. Unemployment is expected to decrease to 21% in Spain, more than one percentage point lower compared to 1996, as the increase in the overall activity stimulated job creation by approximately 3%, on annual basis, during the first nine months of the year. Unemployment in England is forecasted to fall at 6.9%, the lowest rate since 1990. Meanwhile, unemployment in Portugal is expected to drop at its lower level since 1993. In France, efforts to reduce unemployment will result to the creation of 150,000 new jobs at the cost of FF 8 million. A similar program has been decided in the UK, offering incentives to employers in the private sector. The program of a total cost of GBP 5 million will last for 5 years and will be financed by a special tax Chart 2.11 The ratio of Gross Public Debt/Nominal GDP continues to present a major problem for Greece but also for Belgium and Italy, countries in the Euro zone. Gross public debt/nominal GDP in Belgium and in Italy are expected to decrease in 1997 to approximately 124.5 and 122.3, respectively. England is expected to have the lowest, along Germany and France Chart 2.12.
I have read your comments with interest and have been keen on getting into the Greek Stock Market. Unfortunately, my current stock broker (Charles Schwab.Europe) doesn't deal in European Stocks !!! Perhaps they should consider dropping 'Europe' from their title. In any case, I am interested in getting information on any stockbrokers who provide efficient access to the Greek Stock Market and charge reasonable dealing prices. Can you help?Best Regards, Homer59
Hello,It's my first time in this site and I'm really excitedto participate.I was also very disapointed reading some at least pesimistic predictions about the future of the Greek Economy and the Athen's Stock Market and that, written from "Greek Hands"!The truth remains that it's a rapidly growing market that has got it's own rules which you must learn and respect AND that will continue growing this way for at least another four years.I'm watching this growth from it's beginning from the position of a major company's "stock's technical analysis" department and I've decided now to invest my own capital and to participate as an Investor considering that this is the best moment to do it.On your request for some help on investing on the ASM I'd be glad to assist but I need some more info such as:a)Capital to be invested.b)Expectations.c)Investment character (agressive, conservative etc.)d)Services to be provided (acces only, technical analysis,portfolio management etc.).RegardsGregory
Hi, and thanks for getting back to me. [By the way this was my first posting on the message board too and I am hoping for some useful exchanges and (hopefully) some great stock selection tips]To answer the questions you ask, please note: a) I have not yet decided how much to invest yet, but I will be investing in UK Sterling.b) My expectations are that I would be looking for my investment to grow by at about 50% over the next twelve months (or more, hopefully).c) From my last note you have probably realised that my approach to shares is on the aggressive side. d) I am looking for access to buying and selling facilities. (Although the technical analysis service sounds good.)If I am not mistaken, I think it is a good time to buy into the Greek market about now. I am particularly impressed with the Commercial Bank of Greece' s performance over the last year, amongst others. And, although OTE appears to have had a dissapointing run, I think it could prove an excellent long-term investment. What do you think? Any advice would be greatly appreciated. Regards,Homer59
Hi Homer,It was my pleasure to give you a first picture of ASM.As I see, you're an agressive investor and that means we're pretty similar...Further on, a target of 50% annual return on your investment is absolutely real and it can easily be more than that if you'll think that on the portfolios I'm managing, I had a return of 32% for just the November who anyway it was not such a good month for the ASM. You've not mentioned me the capital you intend to invest but for a minimum of 20,000 pounds, I can give you some really good ideas free of charge ofcourse!Also, I could easily establish you an investment account that could give you the access you required to buy and sell! You just have to give me an address where I could send you the proper documentation which you should return back to me signed with your signature verified by a soliciter. After I receive your documents and in 5 working days time you can have your account ready to trade.Now, as far as OTE concerns, I would n't even approached it since it had no success up to now that was the only telephone company in Greece. From the next year huge foreign telephone companies have announced their expand in to the Greek market. So, you can imagine OTE's destiny!!!The Commercial Bank is really a big stable and with great success this year Bank. But it has a pretty high stock price which gives less flexibility to the Investment and also less space to raise up! There are other far more cheaper papers with far more bigger perspective! I would invest to the Commercial Bank out of my proffits in order to secure (lock) them! Closing, would you be interested on investing on a revolutionary "investment-insurrance-unit linked" product that has a return of 143% from the beginning of the year providing at the same time life insurance cover on the amount of the invested capital AND THE MOST IMPORTANT, it fully guarantees the investing capital which means that in the worse case you get your money back!I'll be happy to give you some more details if you're interested and I could also provide you the right to sell it further in your country for a good commission ofcourse. Many say it's too good to be true but it is true!RegardsGregory
Hi Gregory,Thank you for your offer to help and for the advice on OTE and the Commercial Bank of Greece. Unfortunately, I do not have 20,000 to put into the market at present, but with some careful management, it won't be too long before I get there!I have decided to arrange buying shares through the Cyprus Popular Bank's London Office - it is probably the easiest way for me for now. Thanks again for your advice. I will come back when I consider other stocks to target in Greece. Regards,Homer59
You're absolutely welcome.It was my pleasure.SincerelyGregory
Hi Homer59,Here are some Websites that might help you in the Greek Market and with stockbrokers in Greece. I cannot trade from my current location here in Canada/U.S. but I do trade directly with a broker in Athens. I do my trades thru proxy.http://www.natfeed.com/Home/default.htmlhttp://www.invgr.com/http://stockrally.cjb.net/http://users.med.auth.gr/~tsikaras/stock.htmhttp://www.sophocleous.com/http://www.olympicsec.gr/http://www.omegasec.gr/http://www.otenet.gr/sofokleous/http://www.naftemporiki.gr/naftonline/ase/amall.htmhttp://www.devletoglou.gr/index.htmlhttp://www.mutualfunds.gr/asps/index.asphttp://www.insitu.gr/stock_market/http://www.inbroker.gr/inBrokerHome/index1.htmlhttp://www.enet.gr/finance/firstfin.htmhttp://www.dimco.gr/http://www.compulink.gr/freestocks/http://www.athenstock.com/http://www.capitallink.com/http://www.greekstocks.com/Anyways, I have been following the ASE for the past 2 years now and I have been in the Market trading in the ASE for a little over a year. I don't really have to tell you waht the returns have been as you probably already now. The Greek Market as I have already mentioned in my previous posts is booming while currently I would say the ASE Index is most likely in a correction mode, it is still up almost double. The YTD Index range is 2762.57 - 6484.38 but closed today down 189 @ 5034.http://quote.yahoo.com/q?s=^ATG&d=tI believe that you have to be a bit more selective and carefull with your investments as the Market has become over saturated with Novice investers just dumping their money into anything without knowing anything about the investment their making.I still believe that there is definetely room for an upward potential in the ASE for the long-term but currently some volatilty up/down due to some infaltionary measures/Y2K fears/future elections/etc...I do most of my trading in the US Market trading stocks & options, but I do follow almost daily the ASE Market and currently hold some investments.I hope that we have enough people interested in the Greek Market that maybe we can request from the FOOL to create a separate folder just for the ASE/Greek Markets.Good Luck &Happy Trading !KALA KERTHEE !!!Yianis
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