As we predicted correctly yesterday (here in editor’s comment), Russia signed the peace treaty with Ukraine, after suffer heavy loss of oil income by billion of $ per day, condemnation from all EU members and global leaders.
Should we sell on good news? When I read news today, most people still cautious. WSJ has this article: “EU Leaders Cautiously Welcome Minsk Cease-Fire Accord”. and most still compare this with Sep 5th, 2014 failed Ukraine ceasefire. Our judgement is: this is totally different. Putin learned the opinion of the world, learned the heavy loss of oil dollar. This is his more difficult step, all the future step will be recovering, repairing ties and normalization. including stocks and Ruble and so stay invested in Russia, as more people get convinced. The big trend is: big money will flow into Russia and Russia asset in the weeks ahead.
Merkel’s Germany and France will very quickly push for the cancellation of sanction and normalization to Russia, as a reward and benefit to Russia’s Putin. Germany, France and Russia will soon ramp up economic cooperation, faster than most people think. Russia is the best and last investment frontier as of this moment and German and France know that. the reasons have been published a few weeks ago here and here.
As we discuss here, Russia no longer offend any, Iran is not enough reason. in non-crisis mode, in case US and Saudi covered their put and short on oils(which we think they did). Oil will recover, see detail here and here. stay in UWTI. but I would say it has higher risk than Russia asset.
Russia has the best educated people, very advanced technlogies, lowest debt and the biggest resources….more here…..everything spells bull. it is the last and best investment for years to come. In the meantime, it is and will gradually becoming more democratic and reasonable, it has learned a hard lesson.
Dave Liu, Editor of TopCoolsAdd to favorites