Necessary fund gatings 'disastrous' for Eastern European funds

Suspensions expected

All Russian equity funds of funds with heavy exposure to Russia will have no choice but to suspend trading “in line with rules governing open-ended funds”, according to several investment professionals, who warn this will likely remain the case for “a long time” and will be “disastrous” for such mandates.

Since the Ukraine crisis began less than two weeks ago, the Russian stockmarket has remained closed to trading, Russian ETFs have sold off by more than 95% and MSCI has reclassified its Russia indices from emerging markets to standalone market status.    More than a dozen Russian-focused funds have already suspended trading globally at time of writing (3 March), while Russian stocks listed on the London Stock Exchange have fallen in value by an average of 98%.  "It is impossible to sell Russian securities at the moment," said Ryan Lightfoot-Aminoff, senior research analyst at Chelsea ...