Understanding the Russia Markets
The Russian equity market presents a stark case of statistical cheapness masking extraordinary risk. On paper, Russian stocks trade at some of the lowest price-to-earnings multiples in the world, a discount that reflects deep political risk, governance concerns and, since 2022, a sanctions regime that has largely severed the market from international capital. The MOEX index is overwhelmingly weighted toward energy and materials, so its fortunes rise and fall with global oil, gas and metals prices. For international observers the practical reality is that reliable, timely data is now difficult to obtain and the market is largely inaccessible, so any valuation figure should be treated with heavy caution. Russia is included here for completeness of global coverage, but it stands as a reminder that a low valuation is never the same as a safe one.