SBRCY - Russia And EM Bond ETFs: What Comes Next?

• The sweeping package of Russian sanctions introduced over the past several weeks (particularly those introduced by the U.S. Department of the Treasury’s Office of Foreign Assets Control on February 22 and 24) have had existential ramifications for Russian debt.
• Valuations have been driven down significantly due to illiquidity, the possibility of technical if not actual defaults, and the potential for even more stringent and far-reaching sanctions.
• Passive fixed income ETFs generally use optimization to match the primary risk and return drivers of their indices in order to achieve their investment objective.

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