Greece as Buy Opportunity, No Joke

Chidem Kurdas

A year or so ago there was an unconfirmed report than John Paulson was looking to profit from Greek debt. This year some investors bought Greek government bonds at steep discounts. Very few buy Greek stocks—there are certainly not many hedge funds that do; I have not heard of a single one.

Foreign capital, a major part of the Athens Exchange, largely left in 2008 and has not returned.

It may be time to consider Greek stocks, if you listen to people from the country. The Greek blue chip index, including banks, is down 91% from its 2007 peak. Investors should find the massive correction appealing, says George Linatsas, founder of Axia Ventures Group in Cyprus. Shares are around 20-year lows and some companies’ market capitalization is less than the cash held by the company, he said, speaking at a conference in New York.

There are tax-efficient opportunities for international investors, says Socrates Lazaridis, executive chairmen of the Athens Exchange. For instance, a new ETF that tracks the common Greek-Turkish GT30 index started trading in Athens and Istanbul.

This is not a market for short-term trading. It is not liquid—daily trading volume is significantly less than what it was in 2007. Mr. Linatsas says nobody invests because the risk is perceived as so high but if the current European attempt to restructure Greek debt and put in new financing is successful, foreign investors will start coming in.

He argues that in 2012 there will be unprecedented money making opportunities for investors with long enough time horizons.

Advertisement

Tags: Athens Exchange, Axia Ventures Group, George Linatsas, Greek-Turkish GT30, Istanbul, Socrates Lazaridis