- ERUS has struggled to regain its prior highs year over year, following the break-out of the COVID-19 pandemic.
- However, while ERUS' significant energy exposures (40% of the fund's portfolio) dragged the portfolio down, the fund has nevertheless exceeded its past share price highs after adjusting for FX.
- ERUS is therefore starting to become attractive on the basis of a high earnings yield, high forward dividend yield (of circa 7%), and undervalued domestic currency.
- ERUS is a long-Russia, long-energy, long "global economic growth" in 2021.
- Given how pessimistically priced ERUS seems to be, I think there is some potential here for some convexity on the upside.
For further details see:
ERUS: Russian Equities Remain Out Of Favor, But Upside Potential Also Remains