How to invest in Russia using ETFs
How do I invest in Russian stocks?
The easiest way to invest in the whole Russian stock market is to invest in a broad market index. This can be done at low cost by using ETFs.
On the Russian stock market you'll find 4 indices which are tracked by ETFs.
Alternatively, you can consider indices on Eastern Europe or emerging markets. In the indices on Eastern Europe, Russia is weighted strongly with a weight of more than 70%. In the emerging markets indices, the weight of Russia is significantly lower.
Performance of Russian stocks (MSCI Russia)
Indices in comparison
The best indices for ETFs on Russia
For an investment in the Russian stock market, there are 4 indices available which are tracked by 5 ETFs. Among the available indices there are number of capped indices. These indices limit the maximum weight of one constituent in the index in order to improve the diversification. The total expense ratio (TER) of ETFs on these indices is between 0.60% p.a. and 0.65% p.a..
| Index | Investment focus | Number of ETFs | Number of constituents | Short description |
|---|---|---|---|---|
MSCI Russia |
Russia | 1 ETF | 23 (31/12/2020) |
The MSCI Russia index tracks the Russian equity market.
Index factsheet |
MSCI Russia 25% Capped |
Russia | 1 ETF | 23 (31/12/2020) |
The MSCI Russia 25% Capped index tracks the Russian equity market. Constituents whose weights are greater than 25% are capped daily to 22.5% and quarterly to 20%.
Index factsheet |
MSCI Russia Capped |
Russia | 1 ETF | 23 (30/12/2020) |
The MSCI Russia Capped index tracks the Russian equity market. The largest constituent is capped at 30% while the weight of any other constituent is capped at 20% (reviewed quarterly or if 35% is reached).
Index factsheet |
MSCI Russia IMI Select GDR |
Russia | 2 ETFs | 18 (31/12/2020) |
The MSCI Russia IMI Select GDR tracks a broad selection of stocks or GDRs of Russian companies.
Index factsheet |
| ETF ISIN |
Fund size in m EUR |
TER in % |
Use of profits | Fund domicile | Replication method | |
|---|---|---|---|---|---|---|
| Lyxor MSCI Russia UCITS ETF - AccLU1923627092 | 259 | 0.65% p.a. | Accumulating | Luxembourg | Unfunded swap | |
| iShares MSCI Russia ADR/GDR UCITS ETF (Acc)IE00B5V87390 | 246 | 0.65% p.a. | Accumulating | Ireland | Full replication | |
| Xtrackers MSCI Russia Capped Swap UCITS ETF 1CLU0322252502 | 93 | 0.65% p.a. | Accumulating | Luxembourg | Unfunded swap | |
| HSBC MSCI Russia Capped UCITS ETF USDIE00B5LJZQ16 | 89 | 0.60% p.a. | Distributing | Ireland | Full replication | |
| Lyxor MSCI Russia UCITS ETF - DistLU1923627332 | 19 | 0.65% p.a. | Distributing | Luxembourg | Unfunded swap |
| Index | 1 month in % |
3 months in % |
6 months in % |
1 year in % |
3 years in % |
|
|---|---|---|---|---|---|---|
| MSCI Russia IMI Select GDR | 7.20% | 17.63% | 4.48% | -23.43% | 23.72% | |
| MSCI Russia | 7.12% | 16.63% | 4.22% | -22.22% | 23.03% | |
| MSCI Russia 25% Capped | 7.47% | 15.81% | 5.33% | -20.47% | 26.53% | |
| MSCI Russia Capped | 7.52% | 15.98% | 5.64% | -19.62% | 27.33% |
| Index | 2021 in % |
2020 in % |
2019 in % |
2018 in % |
2017 in % |
|
|---|---|---|---|---|---|---|
| MSCI Russia IMI Select GDR | -24.32% | -23.43% | 53.10% | 5.54% | -6.75% | |
| MSCI Russia | -23.20% | -22.22% | 54.17% | 2.60% | -5.53% | |
| MSCI Russia 25% Capped | -21.33% | -20.47% | 53.37% | 3.73% | -9.39% | |
| MSCI Russia Capped | -19.62% | -19.62% | 53.51% | 3.19% | -7.54% |
Source: justETF.com; As of 31/12/2020; Calculations in EUR based on the largest ETF of the respective index.
The best Russia ETFs
by 1 year return
| 1 | HSBC MSCI Russia Capped UCITS ETF USD | -19.62% |
| 2 | Xtrackers MSCI Russia Capped Swap UCITS ETF 1C | -20.47% |
| 3 | iShares MSCI Russia ADR/GDR UCITS ETF (Acc) | -22.22% |
The cheapest Russia ETFs
by total expense ratio (TER)
| 1 | HSBC MSCI Russia Capped UCITS ETF USD | 0.60% p.a. |
| 2 | iShares MSCI Russia ADR/GDR UCITS ETF (Acc) | 0.65% p.a. |
| 3 | Lyxor MSCI Russia UCITS ETF - Acc | 0.65% p.a. |
Eastern Europe indices with a share of Russia
Besides Russia ETFs you may consider indices on Eastern Europe. In total, you can invest in 1 Eastern Europe index, which is tracked by 1 ETF. With more than 70%, Russia is weighted strongly in the MSCI Emerging Markets Eastern Europe 10/40 index. The total expense ratio (TER) of ETFs on Eastern Europe is around 0.74% p.a..
| Index | Investment focus | Number of ETFs | Number of constituents | Short description |
|---|---|---|---|---|
| MSCI Emerging Markets Eastern Europe 10/40 | Eastern Europe
Russia: 71.97% (30/10/2020) |
1 ETF | 43 (31/12/2020) |
The MSCI Emerging Markets Eastern Europe 10/40 index tracks stocks from emerging Eastern European countries. The imbedded 10/40 rule limits the weight of a single company to 10% of the index. The sum of all companies with weights between 5% and 10% is limited to 40%.
Index factsheet |
| ETF ISIN |
Fund size in m EUR |
TER in % |
Use of profits | Fund domicile | Replication method | |
|---|---|---|---|---|---|---|
| iShares MSCI Eastern Europe Capped UCITS ETFIE00B0M63953 | 159 | 0.74% p.a. | Distributing | Ireland | Optimized sampling |
| Index | 1 month in % |
3 months in % |
6 months in % |
1 year in % |
3 years in % |
|
|---|---|---|---|---|---|---|
| MSCI Emerging Markets Eastern Europe 10/40 | 6.75% | 15.05% | 6.12% | -18.84% | 7.98% |
| Index | 2021 in % |
2020 in % |
2019 in % |
2018 in % |
2017 in % |
|
|---|---|---|---|---|---|---|
| MSCI Emerging Markets Eastern Europe 10/40 | -18.84% | -18.84% | 31.66% | 1.06% | 2.83% |
Source: justETF.com; As of 31/12/2020; Calculations in EUR based on the largest ETF of the respective index.
Emerging markets indices with a share of Russia
As second alternative to Eastern Europe you may consider indices on emerging markets. Currently, you can invest in 2 emerging markets indices, which are tracked by 2 ETFs. The total expense ratio (TER) of ETFs on emerging markets is between 0.65% p.a. and 0.74% p.a..
| Index | Investment focus | Number of ETFs | Number of constituents | Short description |
|---|---|---|---|---|
| FTSE BRIC 50 | Emerging Markets
Russia: 7.15% (30/10/2020) |
1 ETF | 50 |
The FTSE BRIC 50 index tracks the 50 largest stocks of the BRIC countries (Brazil, Russia, India, China).
Index factsheet |
| MSCI Emerging Markets EMEA | Emerging Markets
Russia: 23.16% (30/10/2020) |
1 ETF | 164 (31/12/2020) |
The MSCI Emerging Markets EMEA index tracks large and mid cap companies from emerging markets in the EMEA region (Europe, Middle East and Africa).
Index factsheet |
| ETF ISIN |
Fund size in m EUR |
TER in % |
Use of profits | Fund domicile | Replication method | |
|---|---|---|---|---|---|---|
| iShares BRIC 50 UCITS ETFIE00B1W57M07 | 235 | 0.74% p.a. | Distributing | Ireland | Full replication | |
| Xtrackers MSCI EM EMEA Swap UCITS ETF 1CLU0292109005 | 39 | 0.65% p.a. | Accumulating | Luxembourg | Unfunded swap |
| Index | 1 month in % |
3 months in % |
6 months in % |
1 year in % |
3 years in % |
|
|---|---|---|---|---|---|---|
| MSCI Emerging Markets EMEA | 3.86% | 10.73% | 7.58% | -15.57% | -13.55% | |
| FTSE BRIC 50 | 1.69% | 10.19% | 13.84% | 8.88% | 30.16% |
| Index | 2021 in % |
2020 in % |
2019 in % |
2018 in % |
2017 in % |
|
|---|---|---|---|---|---|---|
| MSCI Emerging Markets EMEA | -15.97% | -15.57% | 17.34% | -12.74% | 8.45% | |
| FTSE BRIC 50 | 7.55% | 8.88% | 25.09% | -4.43% | 19.63% |
Source: justETF.com; As of 31/12/2020; Calculations in EUR based on the largest ETF of the respective index.