Jim Rogers, the veteran American investor who is based in Singapore, is reportedly pouring funds into Russian ruble-denominated sovereign bonds and is mulling over investing in Kazakhstan, Iran, and China at a time when U.S. stock indexes are near their all-time highs.
Jim Rogers told a group of journalists that he had bought Russian ruble-denominated sovereign bonds “a couple of weeks ago,” RIA Novosti, a state-operated domestic Russia-language news agency, reported on Monday.
The 74-year-old businessman made the disclosure while complaining about the limitations U.S. sanctions have placed on the possibility of buying Russian bonds. (Source: “Renowned Investor Jim Rogers Puts Money in Russian Ruble Bonds,” Sputnik News, March 22, 2016.)
“Many Russian bonds are under sanctions, and I can’t just pick up the phone and buy them. I as a US citizen and many other citizens of Western countries can’t legally buy the majority of Russian sovereign bonds. It’s absurd!” Rogers was quoted as saying. (Source: Ibid.)
After falling 30% from a peak of 69.7 in January last year in the wake of the oil price crash to 48.80 rubles on May 13, 2015, the ruble rebounded 74% to 85.10 rubles on January 21. One U.S. dollar currently buys 69.60 rubles.
Jim Rogers said that he purchased the ruble bonds because they have a much higher yield than eurobonds denominated in dollars or euros. However, he declined to say how many of the bonds he bought.
Russia’s 10-year bond yield has ranged between nine percent and 12.4% over the past year. Historically, the Russian Government Bond 10Y reached an all-time high of 16.33% in January 2001 and a record low of 6.3% in July 2007. It is currently yielding 9.3%.
Germany’s 10-year bond is currently yielding 0.18% after falling to a 52-week low of 0.05%, France’s 10-year bond yields 0.5%, and the benchmark 10-year U.S. Treasury yields 1.9%.
Earlier on Sunday, Rogers told the Nikkei Asian Review that in addition to Russia, he is also seeking to invest in Kazakhstan, Iran, and China—if China’s stock market retreats further.
“If China’s market goes down low, I would buy there. I am looking to invest in Kazakhstan, where there are very dramatic changes taking place, positive changes. It’s difficult for an American still to invest in Iran, but the Japanese can and should be investing in Iran,” he recommended. (Source: “Want to fix the economy? ‘Start over,’ investor Jim Rogers says,” Nikkei Asian Review, March 20, 2016.)
“There are some places in the world where good things are happening, [but with] American stock markets near an all-time high, I don’t want to buy [in] America,” Rogers said. (Source: Ibid.)
China’s Shanghai Composite Index is currently hovering around 2,960 after falling from a high of 5,178, while the S&P 500 is just five percent below its all-time high of 2,134.71, reached on May 20.
Jim Rogers is the chairman of the investment firms Rogers Holdings and Beeland Interests, Inc., and co-founded the Quantum Group of private hedge funds with George Soros in 1973.