Many India investors have questions regarding how to invest in Russian stock market from India, In this blog, we are going to give you a brief answer to this question.
Invest in the Russian Stock Market: Today, we’ll explain how to do just that. Here are some things to be aware of when buying Russian equities. Moscow Exchange, or MOEX, is the company in charge of running the Russian stock market.
The Moscow Exchange’s securities market is open from 10:00 am to 6:40 pm, Monday through Friday. (As of 03:00 GMT) The Moscow Exchange is open around lunchtime. Every day, Moscow Exchange is open for 8 hours and 40 minutes.
In contrast to the Indian stock market, the Moscow Exchange does not offer any form of pre-market or after-market trading.
Let’s learn a little bit about Russia before we invest in stocks listed on the Moscow Stock Exchange. Since the end of the Soviet Union, the Russian economy has grown. Between 2000 and 2008, Russia’s GDP doubled, and the country established a reputation for having a thriving economy.
Are Indian investors permitted to purchase Russian securities?
As you are well aware, Russia attacked its neighbor Ukraine militarily towards the end of February 2022. Following this assault on Russia, the United States and other nations withdrew their support from several of its largest banks and corporations. among them, the enormous energy company Gazprom.
Russia is among the BRICS nations and one of the markets with the greatest growth rates in the world, but Russia faces numerous political and economic dangers.
The Russian energy industry has foreign investors. Russia is a significant exporter of natural gas and oil, which explains this. However, foreign investors are also interested in Russia’s IT industry. because the market for software in Russia is currently one of the fastest growing in the world.
How to Purchase Russian Shares?
Purchasing American Depository Receipts (ADRs), exchange-traded funds (ETFs), or mutual funds that are traded on U.S. exchanges is the simplest way to obtain exposure to the Russian stock market (ADRs). Investors can avoid the difficulties and hazards involved in making direct investments abroad because these are traded on U.S. markets, including tax issues, execution risk, and odd trading hours.
Popular Russian funds and ADRs that are offered in the United States include:
- Russia Voya Fund (Mutual Fund: LETRX)
- Russia VanEck Vector ETF Trust (NYSE: RSX)
- ADR for Gazprom OAO (Pink Sheets: OGZPY)
Through ETFs and mutual funds, many additional U.S. brokerages provide access to Russian stocks, but they frequently impose higher costs for overseas trading. However, due to sanctions against Russia, American investors are restricted in what they can directly invest in, including government bonds and funds that might invest in energy or defense.
Where can I set up an account to buy Russian stocks? How To Invest In Russian Stock Market From India
How to invest in Russian stock market from India: Anyone who is an Indian citizen and wishes to trade on the Moscow Exchange in Russia must register an account with India INX Global Access of the Bombay Stock Exchange. He can then invest in any share traded on the Moscow Exchange after that.
Russian Stocks Are Subject to Risks
Since its military incursion in Crimea, Ukraine, in 2014, Russia has evolved into a dangerous emerging market. Its dependence on crude oil exports has also exposed Iran to falling oil prices amid worries about world commerce.
A large number of investors are also anticipating the results of recent significant economic reforms, such as banking regulation and supervision, liquidity buffers, and capital fortification.
The market should become less hazardous, more transparent, and perhaps simpler for investors to enter as a result of these improvements.
The reforms have not yet had much of an impact, thus some significant risk variables to think about are as follows:
Less stability and transparency: Most international markets, including Russia’s equities market, tend to be both more volatile and less transparent by comparison with the U.S. stock market, which is usually regarded as a haven for investors.
Energy market exposure: About half of Russia’s earnings and more than 45% of its exports come from oil and gas. Up to 20% of the assets in some Russian ETFs are invested in the energy industry. Numerous hazards associated with commodities translate into high fund risk.
Potential for social unrest: Investors may experience difficulties as a result of socioeconomic challenges. In many protests that took place in Moscow during 2018, 2019, and early 2021, hundreds of people took to the streets.
Reduction in reserves: Throughout 2017, Russia’s reserves were almost completely exhausted. The sovereign wealth fund has risen to $172 billion once more, yet it still demonstrates how swiftly the nation may change.
Russia is still making efforts to reduce unpredictability and economic ups and downs, combat poverty, and combat financial wrongdoing. Although the World Bank forecasts a modest economic rebound in 2021, it may be years before any actions made can be evaluated.
Thanks for reading this blog about how to invest in Russian stock market from India.