TL;DR: RSX is still a 0 in my view. Options have some weird settlement nuances. Actually check the garbage you’re buying before you attempt to buy it. Positions at bottom.
I recently wrote a DD on how Russia’s economy was being posed for a tactical nuke and that being long Russia is about as smart as being long the latest Chinese microcap that has a notice of going concern (i.e. not smart at all). This is still the case imo, my view is that RSX is worth NAV or somewhere close to it.
Since then, there’ve been such developments as this
A snapshot of the Russian economy: an investment expert goes live on air and says his current career trajectory is to work as “Santa Claus” and then drinks to the death of the stock market. With subtitles.
Anyway… there’ve been a couple of rumors that the Russian stock market is opening on Monday and a few people wanting to bUy ThE dIp. It’s worth noting that the Bank of Russia has only said that they’re opening trading of federal loan bonds.
The press release is on the Bank of Russia’s website (reddit banned all ru links)
No, you dear retail trader, can’t buy Russian stocks come Monday. Many of the stocks and ETFs are still halted and an opening of Russia’s stock market does not mean the halts on US exchanges will be lifted.
Russian Stock Halts
|ETF||RSX, RSXJ||Cboe BZX||Regulatory Concern|
|ETF||ERUS, FLRU||NYSE Arca||Regulatory Concern|
|Equity||GDWV, HHR, OZON, QIWI, YNDX||NASDAQ||News Pending and Information requested by NASDAQ|
|Equity||MTL, MBT, CIAN||NYSE||Regulatory Concern|
|Equity||a bunch of them||OTC Markets||Foreign Markt/Regulatory Halt|
(RUSL is technically halted, but it’s been liquidated already.)
One thing that’s good to do before you attempt to buy a dip is to make sure a) you can actually buy it (all of them) b) the company you’re attempting to buy isn’t defaulting (Yandex, et al).
As far as RSX, it holds mostly cash with cash making up 72.42% of the ETF (and this isn’t because of some stocks being marked to 0, the cash position changes day-by-day). RSX has been partially liquidating in the background it seems.
NAV of the cash is about $0.23341/share ($0.3223 (intraday value) * 0.7242).
As far as options go, the Options Clearing Corporation has disabled ex-by-ex (automatic exercise), so you will need to exercise your options manually. The NSCC is no longer accepting exercise clearing (memo 50188 / memo 50208) which may affect settlement of option exercise and assignment. There are still no restrictions on exercise and the deliverable is the same (100 shares of RSX).
Spreads will probably be an issue if your broker doesn’t allow you to take a short position (coughRobinhoodcough).
Since my last post I did add a couple of options to my RSX position before it was halted. They’re halted, but because as an option holder you have the right to exercise, but there are some nuances as I explained above.
10 RSX 5/20 11p
3 RSX 5/20 7p
(and also 9 butterflies on RSX 5/20 11p to lock in some profit along the way)
Submitted March 19, 2022 at 06:52PM by justcool393
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