How to Invest in the Russian Stock Market

The Russian Trading System (RTS) stock market posted incredible gains in the early years of the 21st century, bringing it to the attention of investors worldwide. To buy or sell securities and/or bonds on the RTS, you'll need to go through an intermediary with a proper, recognized license to trade on the Russian stock market.

Instructions

Difficulty: Moderate

Things You’ll Need:

• Capital to invest
• Knowledge of financial markets
• Properly licensed stockbroker

1. Watch the market for a period of several weeks or months before you commit to investing. Get a sense of trends in the marketplace, see what the hot industries are and learn which companies are the major players. You should also follow Russian news and politics to the greatest possible extent while you study the RTS.
2. Ask your regular stockbroker if he is licensed to invest in the Russian stock market. By law, anyone taking action in the RTS must possess either a Federal Financial Markets Service of Russia broker license or a Federal Financial Markets Service of Russia dealer license. If your stockbroker doesn't have a valid license, find one who does by contacting financial-services representatives who work in the Russian communities of larger cities.
3. Remember that your intermediary or representative will also need a valid Federal Financial Markets Service of Russia futures and options license if you want to try your hand in the Russian derivatives market. Such a move, however, is recommended only for seasoned investors. Derivatives trading is complex and can be very volatile.
4. Set up an account with a broker licensed to invest in the RTS on your behalf. Keep in mind that brokerage fees for investing internationally may be higher than what you'd pay to invest in domestic markets.
5. Choose a Russian company to invest in. Keep in mind that it may be possible for you to invest in the RTS using United States dollars, allowing you to forgo the trouble and expense of converting your currency to Russian rubles before investing.

Tips & Warnings

• Follow the Russian stock market directly on the official English-language website of the RTS.
• Overseas stock investing poses additional hazards to the investor. It is doubly important that you do a thorough check into any company you are considering investing in through the Russian stock market.
• Obey the law. It is a violation of international law to invest in the RTS without going through an authorized intermediary.