greek stocks

[compoundinglife]

I have an account that can only hold etfs, mutual funds and bonds. Looked at GREK But the liquidity is low and its heavily tilted to financials.  What other etfs are folks looking at? I am going to try and track down some CEFs today with exposure to Greece.

[tombgrt]

I believe this was one of the better elections outcomes for Greece. Enough power to change something, not enough to dictate. I believe Greece will pull through, especially given ECB stimulus, lower euro (tourism is almost 20% of GDP so added bonus for Greece) and lower oil prices. Short term will be a drag because of uncertainty but longer term things should settle imo. Just my 2 euro cents.

 

This is the worst and most stupid election outcome I could possibly imagine. Its insanely bad and the Greeks are insanely stupid. The Greeks have literally done nothing in terms of structural reform. And the guy they have elected is a lunatic who has just allied with another lunatic. The Greeks annoy me and I live in Canada. My government hasn't even given them any money. Imagine how much the Germans, Finns and others hate the Greeks. Nothing is going to settle down. This is going to get very very ugly.

 

I meant it was a good outcome given that they could have scored an outright majority. I don't believe they will get far without compromises.

[oddballstocks]

You can buy Greek stocks directly on exchange with Fidelity.  I believe commissions are competitive with other European countries.  Haven't done it myself, but I know it's an option.

 

No idea on the quality of what's over there, but I know there are a few net-nets that are probably worth considering.

[writser]

You make some good points, it's a pain for me as well. What do you mean when you hope you don't get riped off when buying German listings? Do you mean in terms of liquidity and spread or are you referring to another risk?

 

I'm only long intralot atm but have been looking at an index ETF, OPAP and Metka. None of them seemed compelling enough until now and haven't done any work on others.

I meant what lathinker said. The German listings are very illiquid and I have no real-time pricefeed. I probably only get filled when a specialist thinks he can make enough money arbitraging my order vs. the Greek listing. I have a trading background and I hate burning money this way, even though I am aware that this line of reasoning is irrational if the stocks are cheap enough.

 

But apart from Intralot most of the stocks that looked interesting didn't have a German listing anyway.

 

You can buy Greek stocks directly on exchange with Fidelity.  I believe commissions are competitive with other European countries.  Haven't done it myself, but I know it's an option.

 

No idea on the quality of what's over there, but I know there are a few net-nets that are probably worth considering.

 

As far as I've read on this forum Fidelity offers access to loads of exchanges. Unfortunately they only accept US clients.

[yadayada]

Grivalia looks interesting. Fairfax is a majority holder I think. They have prime real estate in greece, and unlevered, but not that cheap.

[frommi]

This is the worst and most stupid election outcome I could possibly imagine. Its insanely bad and the Greeks are insanely stupid. The Greeks have literally done nothing in terms of structural reform. And the guy they have elected is a lunatic who has just allied with another lunatic. The Greeks annoy me and I live in Canada. My government hasn't even given them any money. Imagine how much the Germans, Finns and others hate the Greeks. Nothing is going to settle down. This is going to get very very ugly.

 

I can fully understand why the greeks voted this way and i am pretty sure when you are unemployed or barely make a living because of high taxes you vote the same way. As a german i am more upset about our own governments inability to act and think long-term.

[writser]

I can fully understand why the greeks voted this way and i am pretty sure when you are unemployed or barely make a living because of high taxes you vote the same way. As a german i am more upset about our own governments inability to act and think long-term.

 

They had taxes already, but now they actually are supposed to pay them :) . I don't think the election result is a surprise. What I am afraid of is that Syriza won a huge number of votes by promising stuff they can never deliver. Sure, you can make 'demands' from the EU and badmouth them but if you act unreasonable at some point the EU will give you the finger and everybody will be worse off. I think cooperation would be a better strategy (for both sides) but it's hard to win votes with that.

 

That said I don't know a lot about the Greece situation so this is all just speculation.

[NeverLoseMoney]

I have bought a number of Greek small caps.

 

No idea how the political / macro situation will work out, but I think very few people can predict this anyway. Unless you're of the caliber of George Soros it's probably a mistake to even try. It's easy to get caught up in the negative sentiment and make bad decisions. Unless someone has "skin in the game" (money at stake) or lives permanently in the country in question, I heavily discount anything they are saying.

 

Fairfax did decide to invest in Greece and I believe Prem Watsa's view on Europe and deflation doesn't sound very bullish. So despite their negative views they did decide to take the plunge here. The same story with the Bank of Ireland investment. Why? Because they invest bottom up and things simply got cheap enough.

 

The way I deal with uncertainty in my portfolio is to make sure I can survive if things go very wrong. In the case of Greece I've capped my exposure to around 10% of my portfolio and I have diversified by buying a handful of positions. If they do end up leaving the Eurozone and reintroducing the Drachme, I will probably have a bad year investment wise, but it won't kill me. It's my personal portfolio and I don't have to worry about redemptions or some boss firing me for underperforming some arbitrary benchmark.

 

Besides the difficulty in finding a broker, I think the illiquidity is also a problem for most investors. The cheapest stocks I can find in Greece are in the small cap space (<€50 million market cap). There are some family controlled businesses trading at cheap valuations. But they also have a low float and hence tend to be illiquid. For small investors this should not be a major problem though.

 

One company I like and currently own is Kleemann Hellas (KLEM.at).

[theasiareport]

I have a question for those who are buying Greek stocks.

 

Why not simply buy the GREK etf?

 

http://etfs.morningstar.com/quote?t=GREK

 

Financials make up 25% of the ETF, but they have been re-capitalized and even a return to normalized operating conditions will provide a huge upside. You're also partnering up with investors with a strong track record in investing in distressed banks like Einhorn, Watsa and Wilbur Ross.

 

The non-financial stocks are reasonably well run-businesses, for example Coca-Cola HBC AG.

 

I ran through each constituent company and what struck me was that most of these businesses have pared down debt significantly. They are also producing significant amounts of free cash flow.

 

Regards,

theasiareport.com

[yadayada]

why not just leave it alone? I dont see many bargains. OPAP doesnt look that cheap. Only thing that looks cheap is intralot. But a lot of these securities traded much lower in 2012 then today.

[rukawa]

I can fully understand why the greeks voted this way and i am pretty sure when you are unemployed or barely make a living because of high taxes you vote the same way. As a german i am more upset about our own governments inability to act and think long-term.

 

No I wouldn't. If I cut one of my fingers off because I was an idiot, my solution would not be to cut off additional ones.

 

The Greeks have a hugely dysfunctional and incredibly bureaucratic economic system which hasn' t been reformed in the slightest. They have just elected a communist party that wants to roll back the tiny reforms that were made. They are completely insane! They is unemployment is Greece precisely because of parties like Syriza. Syriza want to increase the size of Greece's public sector!!!! Its already a monstrosity. And their solution is to make it bigger?!?

 

The Greek economy does not work unless it gets huge subsidies from Europe which it has been getting for a long time. What we are seeing now in Greece is not austerity. Its economic truth. 

[yadayada]

I can fully understand why the greeks voted this way and i am pretty sure when you are unemployed or barely make a living because of high taxes you vote the same way. As a german i am more upset about our own governments inability to act and think long-term.

 

No I wouldn't. If I cut one of my fingers off because I was an idiot, my solution would not be to cut off additional ones.

 

The Greeks have a hugely dysfunctional and incredibly bureaucratic economic system which hasn' t been reformed in the slightest. They have just elected a communist party that wants to roll back the tiny reforms that were made. They are completely insane! They is unemployment is Greece precisely because of parties like Syriza. Syriza want to increase the size of Greece's public sector!!!! Its already a monstrosity. And their solution is to make it bigger?!?

 

The Greek economy does not work unless it gets huge subsidies from Europe which it has been getting for a long time. What we are seeing now in Greece is not austerity. Its economic truth.

he did choose what is basicly a very right finance minister that seems like smart guy. Not sure how much he can do though. It will be interesting to follow. But I dont think these guys are as left as they claim to be.

[tombgrt]

So it seems that the game of chicken is coming to an end. As expected, the new government was barely able to get anything (so far). Let's hope they get back on track and find a decent compromis asap because the last few months can't have done much good.

 

Looking at bond yields, it doesn't seem as if the market was really expecting a Grexit at any point. This wasn't exactly the case in 2012.

 

[Hielko]

Or the market doesn't care about a grexit?

[rb]

Or the market doesn't care about a grexit?

 

I agree with yadayada that these guys are not that extreme as they're portrayed. And I agree with Heilko that it looks like the market doesn't appear to care about a grexit. But then the market often is wrong in situations like these. The market thought it was a good idea to let Lehman fail. Futures were up strongly that morning, before the shitstorm that followed!

 

I think in these situations is better to let cooler heads prevail instead of having a measuring contest between men with huge egos. But it doesn't seem to be the case here. Better strap in.

 

[tombgrt]

How would holders of Greece govt bonds not care about a grexit??

 

Sure, in 2012 they much owned for a much smaller percentage by governments/ECB but even in a more illiquid market the risk imo should have been priced in more if a grexit was/is likely.

 

Maybe you thought I was talking about the broad bond and stock market Hielko? In that sense I obviously agree.

[tombgrt]

I think this will sound too bullish for most but here it goes: After reading Watsa's yearly letter last night, I was thinking about Greek banks a bit more. It seems he is still confident in recouping his investment and then some. I don't share his faith in the good intentions of the government as it is likely they need some more chickens to pluck and scapegoats to point fingers to. However I do believe that the four remaining banks will do great if Greece is able to recover. As Watsa wrote in his letter, the country was well on it's way to strong economic growth.

 

As Einhorn pointed out, there are warrants available until the end of 2017 for two of those banks: Piraeus Bank and Alpha Bank. The underlying banks are trading at deep discounts to BV and are highly leveraged to the economy either way. As a non-European investor you also get a devalued currency to boot. Given this highly uncertain situation where no one really knows what the end result will be, it only seems logical to leverage that leveraged position to decrease your net exposure.

 

The Piraeus warrants seem way too far out of the money. Imo Einhorn was overly optimistic (even in 2014 when things looked better) in assuming it could trade at 1.5 times book by the end of 2017. Even one time book seems optimistic. The Alpha warrants are less extreme. From current warrants price (0.55), it would return 400-600% if the stock traded at 1 time book or somewhat below that with some time value left.

 

A lot of value guys bought a prices much above current valuations: Wilbur Ross, Einhorn, Watsa, Tim McElvaine, ... They saw value at multiples of the current price. What if the dark clouds finally drift aside over the next 2.5 years and the market realizes these banks operate in a consolidated market with a growing economy, some with exposure to EM?

[SharperDingaan]

We moved a chunk of our non $C funds into NBG - just before the extension was agreed to; a supposedly very high risk proposition. For us, not so much; as the USD were originally bought when the $C was well above parity. Currency matters.

 

Every nation runs on its major banks; because if the people cant get their cash out of the ATM - you get instant riots, and new politicians. Hence the major banks of every nation are protected species - DSIB's, GSIB's, etc. Most would consider all the names mentioned, DSIB's.

 

If there's an exit, it is fabulous business as almost every domestic banking transaction is going to pass through these gate-keepers. If there is no exit - its mostly the same process, but slower. Hold a gate-keeper & you have an unlimited long put on exit, and an unlimited long call on grinding recovery. No roll-over concerns, exceptionally anti-fragile, the only issue is the premium paid.

 

For a large and rising number of the population it makes a lot of sense to exit. There are enough folks today to vote in a leftist party, but tomorrow it will be the majority and with a focus on attempting to direct the outcomes as much as possible. The tipping point has already been crossed.

 

We wish them all the luck in the world.

 

SD

 

 

[muscleman]

We moved a chunk of our non $C funds into NBG - just before the extension was agreed to; a supposedly very high risk proposition. For us, not so much; as the USD were originally bought when the $C was well above parity. Currency matters.

 

Every nation runs on its major banks; because if the people cant get their cash out of the ATM - you get instant riots, and new politicians. Hence the major banks of every nation are protected species - DSIB's, GSIB's, etc. Most would consider all the names mentioned, DSIB's.

 

If there's an exit, it is fabulous business as almost every domestic banking transaction is going to pass through these gate-keepers. If there is no exit - its mostly the same process, but slower. Hold a gate-keeper & you have an unlimited long put on exit, and an unlimited long call on grinding recovery. No roll-over concerns, exceptionally anti-fragile, the only issue is the premium paid.

 

For a large and rising number of the population it makes a lot of sense to exit. There are enough folks today to vote in a leftist party, but tomorrow it will be the majority and with a focus on attempting to direct the outcomes as much as possible. The tipping point has already been crossed.

 

We wish them all the luck in the world.

 

SD

 

With texas ratio over 100, are you not concerned that there will be another capital raise to dilute your ownership?

[CorpRaider]

If the drachma comes back, I might be taking a Greek vacation, so long as things aren't dangerous.

[LongHaul]

Couple of issues.

 

1.  Has anyone read Boomerang's chapter on Greece? It portrays the Greeks as lazy, corrupt socialists milking foreign investors.  Is this accurate?  As an aside I once asked a Venezuelan about why people there elect Chavez, etc.  And she said the majority agrees with him. Pretty nuts. 

 

2.  Been looking at some Greek companies and noticed that Minority Interest Income tends to suck out a high proportion of Net Income.  10% of Total Shareholders Equity might be MI  on the balance sheeet but MI might take a much bigger percentage.  Kleeman and Intralot have this.  Is this normal because I can't help but wonder if someone is just looting shareholders?

 

 

 

 

[TwoCitiesCapital]

Couple of issues.

 

1.  Has anyone read Boomerang's chapter on Greece? It portrays the Greeks as lazy, corrupt socialists milking foreign investors.  Is this accurate?  As an aside I once asked a Venezuelan about why people there elect Chavez, etc.  And she said the majority agrees with him. Pretty nuts. 

 

2.  Been looking at some Greek companies and noticed that Minority Interest Income tends to suck out a high proportion of Net Income.  10% of Total Shareholders Equity might be MI  on the balance sheeet but MI might take a much bigger percentage.  Kleeman and Intralot have this.  Is this normal because I can't help but wonder if someone is just looting shareholders?

 

I certainly think there is some level of milking that goes on. If you look at the Greek shipping companies, many are set up where the holding company owns the ships and it pays an outside company, usually owned by the CEO of the holding company, a fee to manage them. The CEO then gets a fixed fee from each charter, purchase, and sale of ships regardless of what shipping rates are. This also incentivizes the CEO to get as many ships as possible to increase chartering, purchasing, and sales activity that pays him more on a regular basis even if rates are low due to oversupply.

 

I can't say this applies to the generalized economy or to suggest that Greeks are lazy, but I can say that you can expect a greater amount of swindling here. The question is - do the valuations justify it? I know that Gazprom wastes billions in corrupt practices, but at today's valuation I think investors are compensated for that. I feel the same about Greek equities in general.

[muscleman]

We moved a chunk of our non $C funds into NBG - just before the extension was agreed to; a supposedly very high risk proposition. For us, not so much; as the USD were originally bought when the $C was well above parity. Currency matters.

 

Every nation runs on its major banks; because if the people cant get their cash out of the ATM - you get instant riots, and new politicians. Hence the major banks of every nation are protected species - DSIB's, GSIB's, etc. Most would consider all the names mentioned, DSIB's.

 

If there's an exit, it is fabulous business as almost every domestic banking transaction is going to pass through these gate-keepers. If there is no exit - its mostly the same process, but slower. Hold a gate-keeper & you have an unlimited long put on exit, and an unlimited long call on grinding recovery. No roll-over concerns, exceptionally anti-fragile, the only issue is the premium paid.

 

For a large and rising number of the population it makes a lot of sense to exit. There are enough folks today to vote in a leftist party, but tomorrow it will be the majority and with a focus on attempting to direct the outcomes as much as possible. The tipping point has already been crossed.

 

We wish them all the luck in the world.

 

SD

 

I feel puzzled with the situations here. Sorry for asking such newbie questions. :o

 

So last month, the lenders approved extension and everyone seems happy.

http://www.marketwatch.com/story/greek-stocks-bonds-rally-on-bailout-deal-optimism-2015-02-24

 

But then the debt problems come back again?

http://www.marketwatch.com/story/european-stocks-drop-greek-debt-talks-on-deck-2015-03-09

 

"Over the weekend, Greece Finance Minister Yanis Varoufakis told an Italian newspaper that Greece may hold a referendum on whether to accept its creditors’ financial-aid terms if the government decides they are unacceptable."

 

Can anyone please help me understand what's going on right now?

[CorpRaider]

If I had to bet, it looks like they are about to Grexit, stage left. 

[TwoCitiesCapital]

If I had to bet, it looks like they are about to Grexit, stage left.

 

That's hard for me to imagine with popular opinion in Greece against that option. I doubt the government will simply choose to leave the Euro without the support of the people and the people of Greece allow it to happen without doing an emergency reorganization of their government. I'd be more concerned if the regular polls in Greece showed Greek citizens in favor of leaving.

 

It's an interesting situation to watch. I'm certainly sympathetic with the Greeks that the impositions by the ECB/troika are far too stringent. I read somewhere that no country in the Eurozone has lived up to the deficit reduction/growth demands that arebeing demanded of Greece in their history in the Euro. That certainly seems unfair to demand it of them and not of others. Also, the people are suffering in the depressionary environment that the recession and austerity have created. That being said, Greece has come to the bargaining table with a bunch of nonsense that isn't very well developed or thought out in exchange for disgorgement of profits and more money from other people.

 

I think a resolution will occur, but both sides need to be a bit more realistic....