Liontrust has decided to suspend dealing in the Russia Fund. This means investors are not able to make purchases or redemptions in the Fund until further notice. You can find out more details by downloading the client letter or statement on waiving fees using the links below:
Client suspension letter >
Statement on waiving fees >
Fund price >
Q&A on suspension of Russia Fund
Why have you suspended dealing in the Russia Fund and is this common practice?
Liontrust did not take this action lightly and we appreciate this is disappointing for you as an investor. We want to assure you that we explored every alternative option possible to avoid a suspension of dealing in the Fund. In the end, Liontrust decided that suspending dealing was in the best interests of all investors given the exceptional circumstances in terms of the Russian invasion of Ukraine and the sanctions imposed on and by Russia as a result.
The ban on ‘unfriendly’ foreign investors (those from countries who have imposed sanctions on Russia) trading in local Russian securities continues to prevent the Fund from trading normally in its underlying investments, and it is not clear how long this will last.
Who has made the decision temporarily to suspend dealing?
The decision was made by Liontrust in agreement with the Fund’s Depositary, Bank of New York, who have oversight responsibilities to ensure Liontrust acts in its investors’ best interests and safeguards their assets, and with the knowledge of our regulator, the Financial Conduct Authority (FCA). Liontrust regularly reviews the suspended status of the Fund with our Depositary and provides updates to the regulator.
How long is dealing in the Fund likely to be suspended?
At the moment, we are not able to tell you for how long dealing in the Russia Fund will be suspended. Liontrust will keep the suspension under continual review and we will ensure the suspension only continues for as long as it is justified to meet the best interests of all investors. We will keep investors updated with periodic communications and more detailed information will continue to be provided on this page, which we update regularly.
Does the suspension mean I can’t buy or sell my holding in the Fund?
Yes - we have suspended both purchases and sales in the Fund. Investors’ ability to redeem from the Fund and when this might happen are dependent on the outcome of the current conflict, the lifting of sanctions on and by Russia and the ending of capital controls.
Investors’ ability to redeem from the Fund and when this might happen are dependent on the outcome of the current conflict, the lifting of sanctions on and by Russia and the ending of capital controls.
What are you doing to raise cash, what target are you aiming for and how long will this take?
We have explored all steps to try and raise cash and unfortunately are not able to do so in the current circumstances. When the suspensions and sanctions are lifted, the expectation is that the Fund should be able to reopen promptly and any purchases and sales can continue as expected.
Does it matter whether the fund is held within an ISA?
No, the suspension in dealing applies to all investors.
Why can’t the Fund re-open if there is trading on the Moscow Stock Exchange?
The Moscow Stock Exchange reopened on 24 March 2022 after a period of suspension. Trading was initially restricted to only local Russian investors. Trading for 'friendly' foreign investors (those from countries who have not imposed sanctions on Russia) resumed in August 2022, however, investors from 'unfriendly' countries are still unable to trade.
Whilst the fund also holds some Russian investments which are traded in London and New York, most of these are currently suspended. Due to the strict capital controls restricting money moving out of Russia, as well as extensive sanctions against Russian companies, it has not been possible to end the suspension of the Liontrust Russia Fund. For this to happen, we need the Stock Exchange to be fully reopened to all investors and for the removal of capital controls, although these may not be the only factors required to unsuspend the Fund.
How are you currently valuing the Russia fund?
Where possible, the price will be calculated at 12pm every day and released during the afternoon. The price of the Fund shown is indicative and for reference purposes only. As a result of the ongoing restrictions over non-local investors buying and selling shares in Russian companies, the price cannot currently be realised by investors. We are showing prices in our Interactive Fund Centre.
The Liontrust Russia Fund is valued as the sum of its assets minus the sum of its liabilities. In normal circumstances, the value of the assets is cash, subscriptions, outstanding cash for share sales and the value of shares held by the fund based on the prices available on the relevant stock exchange at the valuation point. Liabilities are any outstanding payments for share purchases, tax, transactions costs, fees and outstanding redemptions.
Currently, there are three classes of shares held by the Fund, depository receipts listed in London and New York are fully suspended, shares listed in Moscow are suspended for trading by 'unfriendly' foreign investors, and an asset moved its listing from London to Astana, Kazakhstan.
We are pricing suspended Depository receipts by sourcing the prices of their underlying listings from the Moscow Stock Exchange, the local Russian shares are being priced from the daily traded prices in Moscow, a discount is being applied on both classes of assets to reflect that we cannot currently access these prices. The asset listed in Astana are being priced by sourcing the daily traded price from Astana stock exchange.
Are you still charging a fee for the Fund?
No – Liontrust is continuing to waive all charges investors pay for the Russia Fund while it is suspended. This means that holders of the Russia Fund will not pay the Ongoing Charges Figure (OCF), which includes the Annual Management Charge (AMC) and Administration Fee, for any of the share classes in the Russia Fund until dealing is resumed. We believe this is the right decision while shareholders cannot make purchases and redemptions in the Fund.
What are your short-term expectations for the fund?
We will continue to manage the Fund as best as possible given the current constraints.
Who to contact for further information?
If you have any questions, please contact us on 020 7412 1700 or email LionTA@liontrust.co.uk.
As at 12 March 2024.
