Russia ETFs Drop As Tensions Spike

July 18, 2014

Sanctions and a plane crash were bad news for Russia-focused funds.

Russia-focused equity ETFs fell by almost 8 percent in the past week as a new round of Western sanctions against Russia and as well as news of a Malaysia Airlines commercial flight led some investors to exit positions.

For example, the Market Vectors Russia (RSX | C-63) was the worst performer last week, losing 7.6 percent, followed by the iShares MSCI Russia Capped (ERUS | B-94), which was down 7.2 percent and the SPDR S&P Russia (RBL | D-69), which lost 6.8 percent.

Russia remains one of the more vexing investment propositions, with some seeing deep value there and others unwilling to take any positions in the country. The cautious group fears that the conflict between Ukraine and Russia is but one of many similar situations in the region that have featured and will continue to feature restive Russian minorities garnering support from Russian President Vladimir Putin.

On the flip side, last week’s volatility paved the way for volatility focused products leading all funds in performances, including the iPath S&P 500 VIX Short-Term Futures ETN (VXX | A-47) and the ProShares VIX Short-Term (VIXY | A-47), which gained 4.7 percent and 4.6 percent, respectively. Volatility ETPs, while hardly investments, reliably spike when stocks drop sharply.

Top 10 Weekly Performers, Excluding Leverage/Inverse Funds and <1,000 Shares Traded

Ticker Name Weekly Performance Weekly Volume AUM ($, mm)
VXX iPath S&P 500 VIX Short-Term Futures ETN 4.72% 185,027,024 1,097.34
VIXY ProShares VIX Short-Term 4.61% 4,704,287 108.22
UAE iShares MSCI UAE Capped 4.55% 113,433 57.13
VIIX VelocityShares VIX Short Term ETN 4.47% 287,808 7.54
FOIL iPath Pure Beta Aluminum ETN 3.67% 6,684 3.02
QAT iShares MSCI Qatar Capped 3.59% 369,812 34.64
CHII Global X China Industrials 3.18% 3,436 3.08
CHXF WisdomTree China Dividend ex-Financials 3.09% 11,838 18.92
CHXX EGShares China Infrastructure 3.04% 44,379 8.26
EDV Vanguard Extended Duration Treasury 3.04% 194,238 229.43

Bottom 10 Weekly Performers, Excluding Leverage/Inverse Funds and <1,000 Shares Traded

Ticker Name Weekly Performance Weekly Volume AUM ($, mm)
RSX Market Vectors Russia -7.59% 39,779,686 1,577.90
XBI SPDR S&P Biotech -7.58% 3,654,274 976.58
ERUS iShares MSCI Russia Capped -7.24% 2,260,412 321.27
GRWN iPath Pure Beta Softs ETN -6.87% 1,044 0.87
RBL SPDR S&P Russia -6.78% 64,659 24.91
GAZ iPath Dow Jones-UBS Natural Gas Total Return ETN -5.60% 164,666 25.07
ESR iShares MSCI Emerging Markets Eastern Europe -5.36% 53,469 140.30
RSXJ Market Vectors Russia Small-Cap -5.07% 431,832 55.78
BBH Market Vectors Biotech -5.06% 474,927 486.06
IBB iShares Nasdaq Biotechnology -4.86% 9,101,745 4,595.72

Disclaimer: All data as of 6 a.m. Eastern time the date the article is published. Data is believed to be accurate; however, transient market data is often subject to subsequent revision and correction by the exchanges.

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