- Global authorities have attempted to navigate the situation by introducing sanctions against Russia, which has led to serious supply chain issues.
- Ukraine has had to deal with port closures and safety issues as innocent civilians have had to flee their homes.
- Companies like Airbnb have stepped up by offering shelter for 100,000 Ukrainians who needed refuge.
In a shocking turn of events, we started 2022 with a global conflict when Russia invaded Ukraine. The Russian invasion of Ukraine has impacted the global markets in 2022, which only worsened the economic situation already fraught with rising inflation and supply chain issues.
The Ukrainian people have suffered, and many innocent civilians fled their homes for safety, seeking refuge in other countries. Ukrainian companies have been impacted greatly, along with international companies that operate business ventures in Ukraine. We saw commodity prices rise while stocks dropped, and investors are patiently waiting to see what happens next.
Many organizations have stepped up to offer support and relief to Ukraine. If you’re looking to invest in Ukraine by supporting its economic endeavors, we’ve looked for the top Ukrainian stocks and investments that have exposure to Ukraine.
Why Invest in Ukraine?
Before we look at how to invest in Ukraine, we need to take a step back to consider why we should be investing in Ukraine right now. The Russian invasion has led to commodity disruptions, supply chain issues, trade closures, and rising inflation, and not just in Ukraine. Every part of the world has felt the impact of this conflict.
Kiev, Ukraine, has become a major hub for software developers in the past few years. There are about 200,000 software developers in the country, despite the population only being 43 million. Due to the smaller salaries and high quality of developers, many international companies have hired staff in Ukraine. Many Ukrainian tech startups and companies are hiring as they look to grow. The innovation and growth in the Ukrainian technology industry make a compelling case for adding exposure to this sector of the global economy to your portfolio.
As the conflict has progressed, these Ukrainian companies have displayed resilience in how they responded to the war. Many have continued operations despite all of the issues they had to deal with collectively. Many tech companies with Ukrainian offices continued to operate during the conflict after ensuring the safety of their staff. The steadfastness and determination of the Ukrainians under attack has been truly moving for the world to watch.
Finally, it’s worth investing or donating money to Ukraine because innocent people need our support during this extremely challenging time. The Ukrainians have been through an unfathomable amount of challenges in 2022 already. Donations provide much-needed immediate relief, and economic investment will provide the funds for the Ukrainian economy to continue to grow and rebuild once this conflict has passed.
ETFs with Ukrainian exposure
If you’re looking to invest in an ETF with Ukrainian exposure, here are your best options based on funds that we were able to find with European investment interests.
FlexShares Morningstar Emerging Markets Factor Tilt Index (TLTE)
This ETF is composed of stocks in emerging markets for those looking for a strong buy-and-hold potential. Due to the growth potential of developing economies, many investors have added this asset to their portfolios.
Vanguard FTSE All-World ex-US Small-Cap ETF (VSS)
This ETF gives you exposure to small-cap companies that are listed outside of the United States. This fund tracks the performance of about 3,300 stocks for companies in 46 countries with developed and emerging markets.
Vanguard FTSE Europe ETF (VGK)
This ETF offers exposure to the developed economies in Europe, with holdings spread out across more than a dozen markets. Many analysts are suggesting that it’s time to look past the gloom from the Ukrainian conflict and rising fuel costs.
Vanguard FTSE Developed Markets ETF (VEA)
This ETF includes stocks in various developed markets outside of North America. This fund aims to match the performance of a diverse group of stocks (large-, mid-, and small-cap) companies located in Europe’s major markets.
Stocks with Ukrainian exposure
Many domestic companies have exposure to Ukraine based on the location of their business operations. Many other companies have business dealings that were impacted by the escalating situation in Ukraine. However, we chose to focus on stocks with direct business implications. Here are some stocks with Ukrainian exposure that are worth considering.
Carnival Corp. (CCL)
This is the world’s largest cruise line operator, and they generate about 3.6% of its revenue from Russia and Ukraine. Shares of this stock have dropped since the invasion began due to rising fuel prices and a loss of revenue.
The company announced $3 million worth of relief for Ukraine in March 2022. It’s worth paying attention to this company as they attempt to navigate the challenging landscape with everything that’s happening in Ukraine. One can only speculate when travel to that part of the world will return, so CCL would likely be a buy-and-hold play.
Airbnb Inc. (ABNB)
The war in Ukraine has greatly impacted the online marketplace for vacation rentals and tourism activities. Airbnb had to manage limiting business operations in Russia while also trying to figure out how to assist Ukrainian refugees seeking shelter worldwide.
Airbnb set the bar high in supporting Ukraine as 100,000 people fleeing Ukraine were able to find shelter in other countries thanks to the generosity of Airbnb and its hosts. Airbnb also allowed guests from around the world to book Airbnb units in Ukraine as a donation since they weren’t going to stay there. It’s worth watching Airbnb as the pent-up demand for travel is leading to a boom in folks looking for lodging and travel activities around the world.
It’s also important to note that spending money on a Ukrainian Airbnb unit is putting money into the local economy. So if you don’t invest in Airbnb stock, you can consider supporting Airbnb hosts in Ukraine.
EPAM Systems Inc. (EPAM)
The digital engineering and software platforms currently employ 14,000 workers in Ukraine. Share prices have naturally gone down since the invasion began, but some analysts consider this a buy. Management continues to work around the high exposure to Ukraine and Russia. The company was even able to announce a very strong start to 2022, with revenue growing 50%.
Expedia Group Inc. (EXPE)
The travel company saw earnings decrease when the invasion began in Ukraine due to the obvious travel concerns that the conflict created. In March, Expedia announced that it was stopping the sales of flights to and from Russia. It’s difficult to predict how this conflict will play out, but one can only assume that the travel limitations and rising fuel prices will continue to impact Expedia. It’s hopeful that the situation stabilizes so that the company can resume its operations in Russia and Ukraine.
Top Ukrainian Stocks
The PFTS is the Ukrainian stock market. The following are some of the biggest Ukrainian companies that you can invest in globally. As you select your investments, be aware of We must remind you of the risk involved in trading in global markets due to local uncertainty and the volatility associated with the war.
Kernel Holding S.A. (KER.WA)
Kernel Holding is the biggest producer of sunflower oil in Ukraine, with a headquarters in Kiev. The company trades on the Warsaw Stock Exchange. Kernel Holding has seven different business segments in the agriculture industry. The company has suffered major setbacks regarding plantings and exports due to the Russian invasion.
With Ukraine being a top shipper of corn, sunflower oil, and wheat, it’s important to see if shipping flows will improve. While the company has ramped up sales by rail through its western border, the port closures are causing huge shipping disruptions.
Astarta Holding N.V. (AST.WA)
The Ukrainian agricultural and industrial holding company is currently listed on the Warsaw Stock Exchange. With the main ports closed off due to the ongoing war, Astarta had reported that over 150,000 tonnes of grains were stuck at the border at one point. The company had agreed to deliver 25,000 metric tonnes of corn to European partners in April, but they faced clearance issues from railway officials.
Ukrtelekom is a Ukrainian telecommunication provider with a portfolio of five different business sectors: mobile services, enterprise, customers, corporate clients, and operators and providers. The company was founded in 1991 in Kiev, and they’ve been instrumental in delivering messages and communication since the war in Ukraine began.
What you need to know about investing in Ukraine
As you already know, the war in Ukraine has caused global stock market volatility. Sometimes volatility can create new opportunities. Other times, the volatility can lead to short-term mistakes due to panic.
There are many factors worth considering before investing in Ukrainian securities or any stock that could be impacted by the ongoing conflict between Russia and Ukraine. Hopefully, many businesses can resume operations in Ukraine once they feel that it’s safe to do so.
When you’re looking to invest in the Ukrainian market, you also have to consider the sanctions that are being placed on Russia. As a result of Russia’s invasion, many countries around the world have limited business dealings with them. This also impacts Ukraine since the port closures have led to delays and trade issues. All of these supply chain issues have contributed to inflation rising worldwide.
You must protect your portfolio during times of high inflation and global uncertainty. You can review Q.ai’s Inflation Kit and protect your investments in this way. You can also activate Portfolio Protection at any time to protect your gains and reduce your losses, no matter what industry you invest in.
Investing in stocks with foreign exposure can be a risky proposition. You have to factor in the political climate and business delays due to safety concerns. If you’re looking to support Ukraine directly for immediate relief, look at donating to trustworthy charities that are continuing with humanitarian efforts.
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