Page 101 - RusRPTMar21

The CBR is tracking this new increased risk-taking behavior with some concern as it worries that it could start to impact the value of the currency. The regulator also worried about the inexperienced population taking bigger risks on the securities markets and has introduce regulations to prevent unqualified retail investors from investing into high risk instruments like derivatives.
While there are also significant amounts being invested into the domestic equity market the outflow of funds into foreign stock markets is significant.
Russians bought shares of companies registered in foreign jurisdictions in 2020 worth RUB415bn rubles ($5.6bn). Of this amount, RUB70bn rubles ($949mn) went into shares of issuers in foreign domiciles affiliated with Russian companies.
However, the bulk of the money went into the obvious international bluechip names including the American companies included in the main stock indices: S&P 500, NASDAQ, Dow Jones, which account for the largest influx of funds.
The largest increase in household investments was observed on the St. Petersburg exchange: the volume of net purchases of non-resident shares for the year soared 30–fold, from RUB8bn ($108mn) to RUB242bn rubles ($3.3bn) year-on-year.
As of January 1, 2021, the total volume of investments of individuals in non-resident shares (in particular on the Moscow Exchange) amounted to RUB570bn rubles ($7.7bn), investments of individuals in shares of non-residents affiliated with Russian companies amounted to RUB142bn rubles ($1.9bn), Tass reports.
The inflow of funds from individuals into bonds of non-residents for 2020 amounted to RUB223bn rubles ($3bn), of, which RUB95bn rubles ($1.3bn) account for bonds of non-residents affiliated with Russian companies.
The Moscow Exchange has published retail investor statistics for January. Retail investors bought R28.5bn ($380mn) worth of Russian stocks. Most of the inflows materialized in the last week of the month (R44.5bn), while early in the month retail investors were net sellers. The inflows seem to be a reaction to the late-January market correction. As we have argued in previous notes, individual investors act as a cushion for the market in times of downward pressure. In the meantime, they are still holding on to a significant amount of the cash received in November when they sold R115bn worth of stock to nonresidents.
Flows into mutual funds stayed positive at R28bn, of, which we estimate a third went into the stock market.
The number of brokerage accounts continues to grow fast and has reached 9.5mn, of, which 1.5mn are active, i.e. with at least one trade carried out per month.
Data on individual stocks in the portfolio of retail investors shows that retail money goes primarily into underperforming stocks. For instance, the weight of
101 RUSSIA Country Report March 2021 www.intellinews.com