For what feels like all of this year, the Market Vectors Russia ETF (NYSEArca: RSX) has taken investors on a wild ride.
RSX’s penchant for turbulence is not going unnoticed with bearish traders. On Tuesday, a day after the Russian central bank stunned global financial markets by its benchmark interest rate to 17% from 10.5%, short interest in RSX as a percentage of the ETF’s shares outstanding jumped to 11%, the highest since March, reports Halia Pavliva for Bloomberg.
The rate hike was the second since lastThursday and in the span of less than a week Russian borrowing costs have more than doubled from 8%. [Interesting Day for Russia ETFs]
RSX was particularly volatile in the aftermath of the rate cut, trading in a 20% range on Tuesday. The largest Russia ETF surged 10.1% Wednesday on volume that was more than quadruple the daily average, cutting its one month loss to 23.1%.
That is not deterring some traders from taking a bearish view of RSX. Traders pulled $49.4 million from the ETF on Monday, the biggest one-day outflow from the fund since September 2013, according to Bloomberg.