DataLend: Brazilian securities finance market heats up in 2016

Fees to borrow Brazilian securities continue to climb to new highs as the below chart from DataLend illustrates. The volume-weighted average fee to borrow Brazilian securities is approximately 344 basis points (bps), representing a 52% increase in fees thus far in 2016. If we divide this by asset classes, equities are definitely much hotter at 491 bps with a utilization of 33%. However, fixed income is also very warm at 60 bps with a utilization of 16%.

The hottest sector in Brazil these days by far looks to be Consumer Discretionary, with fees recently eclipsing 1000 bps and utilization just north of 40%. Consumer Staples is in second place with fees around 565 bps and a 31% utilization. Brazilian Industrials come in a close third place with fees reaching 559 bps and a utilization of almost 50%. Finally, Materials rank as the fourth hottest sector in Brazil with fees around 526 bps and a utilization of 51%.
DataLend will continue to monitor these and other hot emerging trends.
—Chris Benedict, Director, DataLend

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