US financier says now is the time to invest in Russia

http://www.reuters.com/article/2015/04/06/us-russia-crisis-stocks-idUSKBN0MX12020150406

Lots of interesting points. Is anyone going to follow this piece of advice?

 

I really don't get on how this is the time to invest in Russia after all that they are doing. I would not take the risk even if things can't get any worse. Was all this a huge financial plot?

 

Well a lot of things in Russia are looking cheap now, especially with the extremely weak ruble. But I am very skeptical of Russia (and have been all my life, long before this current situation) and don't see them as a very stable country politically or economically, especially with Putin pulling all the strings.

 

If anyone thinks to invest in Russia, then in no case do not buy any shares.
There will always be high inflation and therefore expensive money and weak private business.
Invest only in government bonds.
The best strategy for the foreign investor from a country with a freely-convertible currency is the carry trade.
Remember, it's different here.

 

Whilst the article does a great job of promoting the Russian market, I'm not convinced. The amount of corruption in the country deters me, especially with Putin in charge and I'm not certain that the market is entirely trustworthy or stable.

 

Well, I think its large supply of energy will keep the country together. Given its technology and size, I don't think it will fail. Now, will it actually get any worse? I don't see energy taking another major dive. The leadership's decisions will determine the success of the country and I doubt it will wipe out Russia...

 

It might be a great time to invest in Russia but it was reported [late last year]that Russian investors are "liquidating" their investments before their value further plummets. Since they are unwilling to hold onto them and hope for better days it appears like it will take a really long time before Russia's economy rallies. So unless someone is willing to wait that long before they start seeing any returns on their investments, it would be better to invest your money elsewhere.

 

The ruble has been weak for decades, a university teacher can make per month something like 40 or 50USD, what is totally scary. Does this make Russia a good country to invest in? I really can't say.

 

Energy is a clear pick in Russia. There are a handful of ETFs that can expose you to the cycle in Russia GUR and ESR. Check out MLRRY. Mail.RU. It owns the top 3 Russian social network sites. VK has 200 million + users. It copies FB's revenue generating strategies. The company's market cap is $4.5 billion. For comparison. FB mkt cap is 250 billion with 6x as many users. Keep in mind VK is just a piece of Mail.Ru's portfolio.

 

That's not what I'm talking about. If you take a look at the ruble to pretty much any other currency chart for the past year, you will see a big drop. I imagine that part of that drop will be recovered in the next few years, if Putin doesn't decide to invade any more countries. (something that I'm not too sure about)