With oil prices mired in a lengthy slump and emerging markets stocks doing much of the same, it is not surprising that the Market Vectors Russia ETF (NYSEArca: RSX) is lagging and not being embraced by investors.

The largest and most heavily traded Russia exchange traded fund is off almost 7% since the start of the current quarter, but as pressure mounts on oil prices, losses for Russian stocks are quickening. Over the past month, RSX has tumbled 9.4%, making the ETF’s 12.1% year-to-date gain almost appear deceiving.

The combination of a weakening energy outlook and the depreciating currencies are dragging on the ETFs that cover the major exporting countries. For instance, the energy sector makes up more than 40% of the portfolio in RSX. Looking ahead, observers are remain cautious over the market outlook. While President Vladimir Putin and other Russian politicians argue that the worst is over, the economy is expected to remain in a recession for the year. Investors are also expressing concern regarding one of Russia’s worst recessions in the post-Soviet era. [More Issues for Russia ETFs]

“Traders pulled $23.2 million from the Market Vectors Russia ETF last week. That followed outflows of $34.7 million during the prior five trading days in the biggest outflow in two months, according to data compiled by Bloomberg. Short interest in the fund rose to 8.9 per cent of shares outstanding, a three- month high. The fund has fallen 18 per cent since a May peak,” reports Elena Popina for Bloomberg.

When considering the most recent departures from RSX’s, the ETF’s total third-quarter outflows of $3.3 million as of Aug. 12 also appear deceiving.

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