Thinking of Russia is thinking of oil, so you will not be surprised to find many stocks of companies included that are active in the Oil & Gas market sector. Gazprom and Lukoil each take up 20% of this index and Russia ETF.
The financial sector comes in second and after that you will find many other market sectors with a tiny weighing. It is obvious that prices of Oil and Gas will have a huge impact on this Russia ETF.
There is also a double effect here. If prices of Oil and Gas are low it will have an impact on the whole Russian economy which will impact all market sectors. It also works the other way around when prices of Oil and Gas are low and these prices begin an upward move. Then you will see all sectors profit.
Put in other words: Entering this Russia ETF on a low in Oil & Gas prices would be a wise move if the first signals of higher prices are structural.
Lyxor Russia (Dow Jones Russia GDR) UCITS ETF
This Lyxor ETF is tracking the Dow Jones Russia GDR index. This Dow Jones Russia index has of course nothing to do with the well-known American Dow Jones Index. Dow Jones composes many market and regional indices and in this particular case it has composed an index from stocks traded on the Russian Stock Exchange.
Important to know is that this index is not tracking the stocks directly but its GDR’s. A GDR is a Global Depositary Receipt which is a bank certificate issued by a bank with the single objective to trade in stocks from a public company in another country imitating the real trading of an underlying stock.
GDR’s are used when it is difficult to trade in a particular country. Another reason why one creates GDR’s could be the foreign currency the stock is quoted in. Within this Russian GDR index you will find GDR’s of different Russian stocks which are quoted at the London Stock Exchange.
This all sounds a bit confusing isn’t it? Never mind, it all comes down to the essence of this Russian Dow Jones index which is trading the index of some large Russian companies.
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Lyxor Russia (Dow Jones Russia GDR) UCITS ETF info:
ETF provider: Lyxor (Societe Generale)
Exchange: Euronext Parijs
This Lyxor Russia (Dow Jones Russia GDR) UCITS ETF has quotations on different exchanges and is known under several ticker symbols. As long as the ISIN number is identical you are dealing with the same ETF.