Krasnodar, 14 April. The Yug Times has asked managers of leading Russian banks, brokers and market analysts where money should be invested in conditions of coronavirus pandemic, sharp swings in the rouble exchange rate, and the 13% interest income tax recently announced by the Government.
Sergei Nagorny, External Communications Director for BKS Premier, believes what should be assessed first of all is the concrete goal and the term of possible investment, and whether there is a sort of ‘safety bag’ there in the form of three- to four-month earnings.
“Everything must be based on the individual life situation, strategy and current portfolio. If, say, the latter contains some marketable shares and the investment horizon is one or two or more years, then selling them at the current prices would mean merely fixing the loss. What is more, in case of availability of investible funds and a long-term investment horizon, it would be quite interesting to try and buy shares of the most battered oil, financial or aviation companies,” he argues.
According to Bogdan Zvarych, Chief Analyst at Promsvyazbank, considering the difficult situation in the global economy and downfall of a wide spectrum of assets, people should rather stick to the conservative investment tools that are the least risky in terms of possible losses.
“I would mention here such a standard tool as deposits, and a riskier one – bonds, which allow to receive regular coupon profit. When choosing the bonds, it is worth paying attention to the trustworthy ones – federal loan bonds, or bonds issued by large and to a significant extent governmentally owned companies. Under the current conditions, it would be better to choose ones with the maturity term of up to a year,” Mr. Zvarych comments. “Without an experience, which is better to be acquired in the situation of calm market, it would be hard to choose the right moment when it is time to start the purchase.”
He added that it is professional exchange players who may most likely get profit from the crisis.
“Here everything will depend upon the investor’s qualification level. It would be an extremely risky business to invest at the exchange if one does not have relevant competences. What a successful stock-exchange player should have is at least skills of technical and fundamental analysis. If you have this knowledge, you will be able to earn at the exchange – both when the shares are rising up and when they are plunging down.”
Andrei Zhukov, Director of Kuban Credit Bank’s Viktoria VIP Office, asserts that bank deposits have remained a timely and safe asset.
“If the pandemic issue would not be resolved in the nearest future and the oil prices would not be curbed, the Bank of Russia may raise the key rate and, correspondingly, the deposit rates may also be raised,” Mr. Zhukov explains. “The announced interest income tax will be imposed on bank deposits in 2021 and become due in 2022. The tax is to be paid only from the interests exceeding 60,000 roubles, which would alleviate possible losses of the banks’ clients.”
Mark Goikhman, Chief Analyst at Tele Trade, was quoted as saying that the pandemic has not yet reached its peak in Russia or worldwide: “Announcement of non-working days until April 30 was an incredible and unprecedented measure. It was necessary, but the economic consequences of the month-long quarantine will be hard. Economic hardships will last for many months. Ideally, it would be good if people had a financial ‘safety bag’ at least in the sum of their vital expenses for four to six months – but most of Russia’s population does not have it, which is why it is better to accumulate the money for the ‘rainy days’ than putting it at risk by investing them in some financial assets.”
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