On paper, Venezuelan stocks have skyrocketed this year, rising some 300 percent. But looks can be deceiving. And far from being a testament to the strength of the Venezuelan economy, the rally actually speaks to its weakness and fragility.
For starters, the move largely reflects the collapse of Venezuela's currency, the bolivar.
Venezuela has stopped releasing official inflation data, but economists polled by Reuters say an annual inflation rate of 108 percent has been logged through the end of May, thanks to rampant money printing and the collapse of oil. In the U.S., prices are unchanged over the same period, according to the government's consumer price index.
Beyond the bolivar's collapse, the direct cause of the rally is fear, according to several analysts.
"Frantic investors are using the stock market as a vehicle to hedge against rapid currency devaluation. Better to hold stocks than bolivars, is the prevailing thinking," Charlie Bilello of Pension Partners wrote in a blog post.
It's also worth noting that the index is a small one. The general index is composed of just 11 companies, which include banks, a telecom company and a steel producer.