Russian stocks are cheap for a reason

Russia’s stock market has slid by as much as quarter in three months. Some may think it's a buying opportunity, but you should still stay well clear.

Russia's volatile stocks have slid by 25% in three months. This is a buying opportunity, reckon some analysts. Elena Shaftan of Jupiter's Emerging European Opportunities Fund says that the current state of the economy makes Russia a bargain. Strong domestic fixed investment and retail sales have underpinned growth of around 4% a year.

But two key factors determine the near- and medium-term stockmarket outlook in Russia, and both look bearish. One problem is navigating the country's authoritarian and capricious political system. Many major international firms, notably Shell and BP, have managed to fall foul of the government.

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