Entry: June 28, 2005
Spread: US$5.40 to US$6.50
Buy recommendation: Under
US$6.40
Official entry price: US$5.60
Exit: July 8, 2005
Price: US$11—a 45% gain,
although you could also have
bagged even higher gains around
US$17 as the HGX Index raced
upwards. However, this was our
first sell point on these calls. Position status: CLOSED       Hedge #2: HGX December 520
put (HGX XD) Alert sent via email, June 27,
2005, 4:30 P.M.
Entry date: June 28, 2005
Spread: US$25.80 to US$27.70
Buy recommendation: Under
US$32
Official entry price: US$27.30
Current price: US$27 Position status: OPEN/BUY       Hedge #3: HGX September 590
call (HGX IR) Alert sent via email, July 18,
2005, 11:15 A.M.
Spread: US$8.50 to US$9.40
Buy recommendation: Under
US$9.90
Official entry: US$9.40
Current price: US$1.20
Position status: OPEN/BUY n 10 G L O B A L   W E A L T H This undervalued Mexican gem is buying back
shares, hiking its dividend—and ready to net
you 65% profits in 6-8 months by Erin Beale Overshadowed by foreign European giants and the Chinese
powerhouse, Mexico has often felt
like the redheaded stepchild of inter-
national investing—worthy, but
passed over time and time again.       But while the herd still clamors
for China and India, Mexico has qui-
etly risen, demonstrated by the
impressive climb of the benchmark
IPC stock exchange over the past
two years.       In 1994, Mexico was thrown into
economic turmoil following the
devaluation of its peso. The “tequila
crisis” caused panicky investors to
flee the country, even though
Mexico had been newly named as a
NAFTA member.       NAFTA opened Mexico’s trade
barriers in January 1994. As a result,
imports surpassed exports and cur-
rency reserves rapidly diminished.
To pay for these imports, Mexico
borrowed from foreign investors—
and had to repay these debts with
interest. When the debts reached
their apex and the Mexican govern-
ment could not control the burgeon-
ing supply of pesos, devaluation
was the only way out.       Mexico’s central bank devalued
the peso by 13% on December 20,
1994. By the end of that month, the
peso floated freely and in a four-
month period lost a gut-wrenching
50% of its value. Today, one US dollar
equals roughly 10.6 Mexican pesos.   Aftermath creates
opportunity Nearly eleven years after the crisis, the economy is again beckon- ing to investors. GDP growth hit a
respectable 4% last year and is on
track to add another 4% to 5% in
2005. Given the pricey euro and
strengthening US dollar, vacationers
and real-estate seekers alike are
flocking to find deals.       Today, tourism is the third most
important economic activity in the
country, comprising more than 8%
of the GDP. Over 5.2 million interna-
tional tourists visited Mexico in the Next page...