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Korea Exchange announces suspension of Russian ETF trading

Seoul [South Korea], March 8 (ANI/Global Economic): Trading of ‘KINDEX Russia MSCIETF,’ the only Russian Exchange-Traded Fund (ETF) listed in Korean Exchange will be suspended. This is because although prices continue to decline as the valuation will be adjusted at zero from March 10, the retail investors have continued to purchase the Russian ETF.

The Korea Exchange announced on the 4th that it will suspend trading of the KINDEX Russia MSCIETF. The KINDEX Russia MSCIETF is the only Russian ETF operated by Korea Investment Management and follows Morgan Stanley Capital International (MSCI) index.

An official from the Korea Exchange said, “The ETF was previously scheduled to be suspended for trading as the high gap rate (difference between index and market prices) continued for three consecutive trading days. Considering the investor protection and current market situation, the Korea Exchange has decided to suspend trading of this ETF earlier.”

On March 4, the price of KINDEX Russia MSCIETF decreased 29.97 per cent as soon as the market was open and closed at the lower limit. An official from the financial industry said, “This is very unusual that the opening price of ETFs hit the lowest and closed at the same price.”

Korea Investment Management, which operates the Russian ETF, issued an official announcement and said, “We have agreed to completely exclude Russia from the MSCI index and calculate the valuation at 0 won after March 9.” It added, “In this situation, it is expected that the asset value will significantly decrease.”

However, a total of 120,000 shares of trading occurred this day. Among them, some bold retail investors newly purchased 10,534 shares worth 160 million won. Those were the shares mainly sold by institutional investors. Institutional investors net sold a total of 10,986 shares on this day.

Regarding this situation, experts said the investment in the Russian ETF is ‘high-risk betting,’ and recommended to sell. (ANI/Global Economic)

This report is auto-generated from ANI news service. ThePrint holds no responsibility for its content.

Source: The Print

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