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Feature: Embracing the bear
29 April 2010
Analysts and investors have long avoided Russia but this is a mistake, for its economy is easily outperforming its BRIC rivals
The success of the BRIC economies is well documented. Over the past decade, the MSCI Emerging Markets Index rose 102% in dollar terms, an annual gain 7.2%. China posted a 191% increase on the Shanghai Composite; India’s Sensex 30 posted an impressive 226%, though not as much as Brasil’s Bovespa Index, which was up 314%. But the runaway winner in this virility contest is Russia, long ignored by analysts and investors, despite the RTS Index posting an average annual return of 724%, an annual gain of 23.3%.
The BRIC outperformance comes with volatility, but there is no doubting the growth story. Russia’s economy features little debt, huge forex reserves, some of the world’s largest untapped reserves of oil, gas, mineral and other commodities, a skilled workforce and an industry that is undergoing a process of root and branch modernisation.
Javier Garcia, manager of the...
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