The RTS Index (RTSI) is one of the key Russian stock indices, which reflects the dynamics of stock prices of the largest companies traded on the Moscow Exchange, but is calculated in US dollars. This makes the RTS Index an important indicator for assessing the state of the Russian stock market in the context of international investments and taking into account the influence of the ruble to dollar exchange rate.
Features of the RTS Index:
Currency base:
The index is calculated in US dollars, which makes it sensitive to changes in the exchange rate. The growth of the dollar against the ruble can put pressure on the index value, even if the stock prices in rubles remain stable.
Index composition:
Includes shares of leading Russian companies from various sectors of the economy, such as energy, finance, mining, metallurgy and telecommunications. Companies with the largest market capitalization and liquidity have the greatest impact on the index.
Calculation method:
The index is weighted by market capitalization, taking into account the free-float of shares, which allows only shares available for trading on the open market to be taken into account.
Periodic updating:
The index composition is revised once a quarter to reflect the current market situation.
Why is the RTS index important for investors?
International benchmark:
Since the index is calculated in dollars, it provides foreign investors with a clear picture of the state of the Russian market, taking into account currency fluctuations.
Comparison with the Moscow Exchange Index:
Unlike the Moscow Exchange Index (IMOEX), which is calculated in rubles, the RTS Index shows how the Russian market looks in international currencies.
Risk assessment:
The value of the RTS Index is closely linked to the movement of the ruble. This allows investors to take into account not only market risks, but also currency risks.
Trend forecasting:
The index is used to analyze long-term trends in the Russian economy, as well as to assess the impact of the international situation on the stock market.
Real case example:
In 2014, the RTS index lost a significant portion of its value amid the introduction of sanctions against Russia and a sharp fall in the ruble to dollar exchange rate. Although stock prices in rubles remained relatively stable, their value in dollars fell sharply due to devaluation. This situation underscored the importance of the RTS index for foreign investors evaluating the Russian market.
Where is the RTS index used?
By investors: To evaluate the profitability of Russian assets from the perspective of global investors.
By stock analysts: To analyze the dynamics of the Russian stock market in the international arena.
By international financial organizations: In reports and ratings.
The RTS Index (RTSI) is a key tool for analyzing the Russian stock market in an international context. It enables investors to assess the impact of currency and market risks, making it an indispensable benchmark for making investment decisions.
