Excel Funds Management Inc.

Emerging Markets

Response: 3 Reasons to Consider Russia

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As is the case with Canadian investors most US investors focus on domestic equities. The problem is missed investment opportunities by disregarding other countries. This includes Russia, a country that has been making headlines lately. *Here are 3 reasons why to invest in Russia:

  1. Cheap Valuations – Russia equities are cheap compared to both historical averages and other BRIC nations. The Russia MICEX Index is trading at less than 6x earnings compared to its 10 year average of 9x earnings. Russia also normally trades at a 30% discount compared to its BRIC counterparts. That number has reach to over 50% enforcing the idea that Russia is trading at a discount.
  2. Surprising Profitability – The average ROE on the MICEX exchange is more than 18%.
  3. Interesting Energy Play – Russia has become one of the top suppliers of oil.


Clients that are looking for a more aggressive play on emerging markets should consider the Excel Emerging Europe Fund. Year to date the fund is up more that 12%. Russia makes up around 60% of the portfolio with Turkey representing just shy of 15% and Poland around 13%. The Emerging Europe Fund is a unique product and an opportunity for investors. It’s time to take advantage of an emerging story that isn’t going away any time soon.

Written by Jeff K.

*Koesterich, R. (2012, November 4). 3 Reasons to Consider Russia. Seeking Alpha. Retrieved November 5, 2012, from  http://seekingalpha.com/article/976451-3-reasons-to-consider-russia


The indicated rates of return are the historical annual compounded total returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any security holder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.


Author: Excel Funds Management

We Are Leaders. Our Focus is Undivided. Excel Funds is Canada’s specialist in Emerging Market investment opportunities. We pioneered Emerging Market mutual fund design and distribution in Canada. Our focus is undivided – Emerging Markets is all we do. Our Mission Is To Offer Canadians True Global Access By offering Canadians access to rapid growth markets, Excel Funds provides truly global and diverse investment value. Our clients want consistent, responsible and intelligent solutions – we will never stop being challenged and deliver on client expectations. We Listen. We Are Determined To Deliver. Our clients want to understand better. Excel Funds is the only company dedicated to providing investors with actively managed, best-in-class Portfolio Managers based in regional markets. In order to deliver deeper understanding, we are not removed from unique cultural, political and economic experiences. We Initiate. We Create. Investors benefit from strong, sustainable growth. To create wealth for our clients we will: • Offer globally diverse opportunities to capture shifts in world economies • Not resist change and continually lead in Emerging Markets global growth • Engage world class institutional managers for retail investors We Are Passionate. We Will Never Stop Innovating. True leadership is enabling and seeks a positive outcome for all invested. We will not rest on past success, and continue to provide clients with: • Innovative fund structures • Canada’s largest & most comprehensive Emerging Markets products • The best institutional level Portfolio Managers • World class on-the-ground active managers • A singular focus on Emerging Markets, the driver of global growth

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