1/ True, professional managers w. have serious problems explaining to their investors why they are/were invested in Russia (now).
Anyway, truth is important!

I started the year with a 9% Russia allocation and want to do a review and hopefully learn sth.

2/ Truth can hurt our wellbeing. It would be easier to forget about our (read mine) failures or bad outcomes (there is a difference). But to improve/learn we must look at them.

Some self therapy might also be involved here for focusing on new investment ideas.
3/ It should not be necessary to state but it seems it is:
The Urkaine/Russia war is an absolute tragedy! As every war is!
4/ There's a wide range of opinions on what is (morally) still allowed under these very sad cicumstances, while publicly accepted opinions can be in a much narrower range, which, I guess, is a typical development during any war.

(I hope this not to become a political debate ...)
4.1/ I joined twtitter originally at a German train station to find a valve for my frustration about DB (small problems in perspective).
I might have used it <10 times. Did not like twtr.

This account (s4v) is focusing on fintwit/investing stuff, so ...
5/ As of March 2, 2022, my PF shows a ytd performance of c. -5.3%*, largely due to two developments.

i) I ended 2021 with a 9% allocation to Russia (6/f)
ii) some v positive contributions.

(* assuming both at €.01 price. makes for a great painful reminder)
6/ I. I ended 2021 with a 9% allocation to Russia (6.2% Gazprom ADR, 2.9% Sberbank ADR)
7/ One way to see it, was I played 'Russian roulette' and I lost!
According to my posts I was very aware of the various risks related to emerging markets with weaker institutions etc...
And yet, I thought it would make for a good investment/bet
8/ Re-reading my piece hurts. I updated it as recently as Jan'22 (Kazakhstan protests at the bottom), yet I did hold on to GAZ & SBER.

I even wrote, that contribution remains limited, likely due to never exp. a 100% loss of RU exposure, but more like a heavy loss (ie -30/50%)
9/ Truth be told, I did never believed that a Rus/Ukr war would happen!

Probably that was much more difficult to believe as a European.

When adding to Sber at 13Jan'22 I wrote 'US/Russia conflict'
I liked the great combo of high ROEs and low P/B
9.1/ Others got it wrong.
So did Vitaliy (whom I admire and love to read, so should you), who comes with 'Russian+' experiences...
BUT! he had no Russain stocks anyway, i guess.
Btw, a big difference not to bet on your (questionable) beliefs

10/ Several biases were probably involved here.
I likely catched contrarian disease. For a long time I believe there is a whole lot going wrong in German/western politics; incl. energy, US LNG!
Also see my 2021 review (link in 6/)
11/ I missed multi-variate thinking. My Rus stocks (ADRs!) had exposure to higher energy/commodity prices, a marco topic I think was a rather good bet to take.
Inpex and Africa Oil are in the same bucket.
Selling some Gaz for BTU or PBR would show good results today (smart?)
11.1/ One possible reason for Russian stocks having been too cheap was that many foreign inverstors were not investing there for various reasons.
Maybe that was a too simple explanation or I should have thought more abt it.
Nothing in investing is too easy!
12/ Tax considerations might have stopped me to sell early.
The 9% allocation came from about 50% appreciation.
Does that make it any better? No really!

(do not get me wrong: PBR US is not the highest quality company either, but offered less Rus exposure)
13/ Some positive performance contributors only sligtly limit the pain and feeling-stupid mood:
- Check Point
- Inpex
- Progressive
- Africa Oil
14/ CHKP was my biggest pos w 16.3%, has a strong run due to higher/accelerating growth in Q4 and higher ambitions for growth.
Since Russia is a huge cyber threat for the West, there will likely be more demand.
Cap is higher now, but so is the prob. for the high growth scenario
14.1/ The sector seems to get ETF inflows with more ppl/investors being intrested in the industry / wanting exposure.
So, i guess the recent strong performance might revert quickly...
15/ Inpex profits from higher energy prices, highlighting once again the importance for multi-variate analysis.

(another great EU example is EDF: should profit tremendously from higher electricity prices but: reactor issues & politics)
16/ PGR is currently 'hurt' by high inflation (severity) with multi-decade record price developments for used cars prices (ie Manheim index) and ACV. But, they are duing hte right steps, IMO.

I reduced on Dec 7 from 12.7>10.8% due to higher CRs.
But i did not! reduce Gaz/Sber 🙈
17/ AOI is in the energy bucket as well, though a smaller (more 'risky') company in emerging market land Africa with E&P exposure!
Might benefit in buyers market

Q is when to sell comps with low quality ?
After a re-rating?
When they are not a perceived! 'bargain' anymore?
18/ Others:
Krka also affected. Russia is their larget country by revenue (21.3% FY'21) and much PPE in Rus due to local requirements.

MBR was affected, possible b/c regional location/closeness and/or will they do less (Russian?) business ?
FLOW (and vix) is surprisingly low
19/ I hope you enjoyed.

Let's all prey for timely improvements in Ukraine and the war to stop!
Add to 9/:
I did not think war would happen, but at least I thought about it, acc. to my notes.

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