ETFs With Russian Exposure Plunge on Ukraine Invasion
Cybersecurity, clean energy, and uranium funds gain following Russian attack.
Funds with large stakes in Russian companies tumbled Thursday following the invasion of Ukraine while those investing broadly in the U.S. and global markets avoided sharp declines.
The $866 million VanEcK Russia ETF (RSX) slid 19.1%. iShares MSCI Russia ETF (ERUS) fell 19.1% on Thursday extending the the fund's one-week loss to 39%.
Foreign funds with a focus on value-oriented or dividend stocks experienced larger declines. Senior manager research analyst Daniel Sotiroff says it’s not uncommon for emerging market value funds to have larger stakes in Russia than broader indexes. Value strategies often overweight cyclical sectors like energy, financials, and materials—exactly the types of companies that dominate the Russian stock market, he says. The Cambria Global Value ETF (GVAL) lost 5.53% and the iShares Emerging Markets Dividend ETF (DVYE), which holds 16% of its portfolio in Russian companies, fell 4.26%.
Katherine Lynch does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.