russian Businesses Getting Rid of Toxic russian Assets

russia’s wealthiest individuals are urgently restructuring their investment portfolios in favor of cryptocurrency, overseas real estate, and private investment funds. This is evidenced by the state of the rf’s stock market, which has been steadily declining for the 19th consecutive week. The desire to get rid of russian securities and move assets out of the country speaks volumes about one thing: people are losing faith in the future of the financial project known as “russia.”

As of mid-July, shares of leading russian companies had fallen significantly in value: “Gazprom” and “vtb” lost more than 21%, “nornikel” – 24%, “aeroflot” – 27%, and “mts” – 28%. “polyus”, russia’s largest gold miner, lost more than half its value – 53% – in just two weeks. According to analysts’ estimates, since the beginning of April this year, the russian stock market has lost approximately 30% of its value and has fallen back to the 2016 levels. Such a situation has not been observed in the entire period for which statistics have been kept, beginning in 1997.

The calculations clearly illustrate the toxicity of modern russian securities. If an investor had invested 1,000 US dollars in Apple stock at the beginning of 2006, he would have earned more than 130,000 dollars in profit today. The same investment in “gazprom” stock, by contrast, would have resulted in a loss of more than 600 dollars. It is no coincidence that the ministry of finance of the rf has already suspended the placement of federal bonds three times over the past month. Investors’ bids were so unfavorable to the issuer that it effectively pulled out of the auctions, leaving it without any raised funds.