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written by reader NYSE-listed investment holding that is a proxy for owning stock in a broad selection of Russia’s biggest companies

By arzuandy, May 20, 2022

Undervalued Shares (Swen Lorenz) is touting the above but only available for his Lifetime Members ($999 subscription). The pitch is “If you, too, want to diversify some of your assets into Russia, this NYSE-listed investment holding will be for you. It’s probably the single-best way to get diversified exposure to Russian blue-chip equities, and you can currently get in at a 50% discount.”
Any ideas what the investment is?

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Travis Johnson, Stock Gumshoe
May 23, 2022 10:31 am

All of the Russia-focused ETFs have halted trading in the US, so I suspect this is the one meaningful closed-end fund that holds a large stake in Russian companies: The Central and Eastern Europe Fund (CEE). Many financial sites note that it does own Gazprom, Sberbank, Lukoil, Yandex and some other ‘blue chip’ Russian companies, and it looks like they still do, according to its own website, but CEE has apparently written those Russian stocks down to zero (I haven’t checked the details, it’s possible that they’ve sold but it looks like they’re just holding them and giving them no value), so today the NAV is now made up 54% of stocks from Poland, 25% Hungary, and only 1% Russia.

There may be other closed-end funds that still hold Russian equities, listed either in NY or overseas, but I’m not aware of any others that are actively trading right now, and all the Russian equities of meaningful size that are traded outside of Russia have been on trading halts since the invasion (well, all the ones I can think of, at least), and are functionally worthless to US investors at least for the time being, so if you do run across funds that still own Gazprom, Rosneft, etc., do note that if they base their value on the current trading price in Moscow they’re being somewhat optimistic.

I have no interest in investing in Russian companies, personally. If I’m going to take political risk in an authoritarian country with central control of the economy and meaningful risk of seized assets, I’d much rather go with China… though I’m pleased, at the moment, that I don’t have to invest in either.

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timcoahran
Irregular
June 1, 2022 4:06 pm

This looks like a big ugly black eye for Undervalued Shares (Swen Lorenz).

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