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How exposed to the Russia crisis is your emerging markets fund?

Anna Fedorova
Written By:
Anna Fedorova

Russian equities have been on a roller-coaster ride this week amid the country’s stand-off with Ukraine. But which funds are most exposed?

On Monday, Russia’s benchmark Micex index tumbled over 10%, as the country’s forces surrounded Ukrainian military bases in the Crimea over the weekend.

The index recovered losses on Tuesday, rebounding more than 5%, after president Vladimir Putin appeared to step back from more concrete moves.

However, the episode has not left the country unscathed. Russia’s central bank hiked interest rates 1.5pp in a bit to prop up the falling rouble, leading analysts to slash growth estimates for 2014.

The Micex, meanwhile, remains down nearly 10% for the year to 3 March and the situation in Ukraine remains unresolved.

Given Russia was already one of the more polarising emerging market investment options, EM equity managers’ exposure to the country varies widely, ranging from as much as 20% to a zero weighting.

Below is a list of managers in the IMA Global Emerging Markets sector that have the most exposure to Russian equities, according to Morningstar:

Fund  Exposure to Russia  Performance YTD 
Templeton Global Emerging Markets   22.1% -7.8%
Neptune Emerging Markets  18.3% -7.6%
UBS Global Emerging Markets Equity  15.1% -6.4%
FP Henderson Rowe FTSE RAFI Emerging Markets   13.8% -9.5%
Goldman Sachs Growth Markets Plus Equity   11.5% -6.2%
Goldman Sachs GIVI Growth Emerging Markets Equity  11.4% -6.6%
Mirabaud Equities GEM  11.1% -7.1%
Goldman Sachs Growth & Emerging Markets CORE Equity  11% -5.4%
Lazard Emerging Markets  10.8% -8.7%
HSBC GIF Global Emerging Markets Equity  10.5% -8.4%

 Source: Morningstar