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Day Trading in Russia

Written By

Michael MacKenzie

Written By

Michael MacKenzie

Michael is a writer and editor with over a decade in journalism and publishing. His niche lies in editing and fact-checking content in the financial services sector, with a focus on online brokers and trading platforms. Michael previously reported on politics and economics in the Middle East and edits books for established publishers.

» Michael MacKenzie Profile Page

Edited By

James Barra

Edited By

James Barra

James is an investment writer with a background in financial services. As a former management consultant, he has worked on major operational transformation programmes at prominent European banks. James authors, edits and fact-checks content for a series of investing websites.

» James Barra Profile Page

Fact Checked By

Jemma Grist

Fact Checked By

Jemma Grist

Jemma is a writer, editor and fact-checker focused on retail trading and investing. Jemma brings a unique perspective to the forex, stock, and cryptocurrency markets and works across several investment websites as a researcher and broker analyst.

» Jemma Grist Profile Page

Updated

Oct 9, 2024

Russia has a relatively short modern history as a market economy, with the two entities that form the country’s largest stock exchange, the Moscow Exchange (MOEX), only founded in the 1990s, shortly after the Perestroika spelt the end of the Soviet system.

Today, vast oil and natural gas reserves, an educated workforce and a developed industrial base help Russia’s economy remain robust, presenting short-term trading opportunities. However, Western sanctions and geopolitical challenges complicate the landscape.

Looking to start day trading in Russia? This guide for beginners will get you started.

Quick Introduction

• Day trading is legal in Russia and is regulated by the Central Bank of the Russian Federation (CBR), an ‘orange tier’ body in line with DayTrading.com’s Regulation & Trust Rating.
• Active Russian traders can deal a range of stocks and commodities on MOEX, but may struggle to use international brokers due to restrictions, limiting access to Western stocks and forex, amongst other markets.
• The Federal Tax Service of Russia (FTS) manages the country’s tax regime, and profits from short-term trading may be liable for standard income tax at a rate between 13% and 22%.

Day Trading Platforms in Russia

What Is Day Trading?

Day trading involves buying and selling assets such as company shares, commodities or currencies within a single day to profit from short-term price movements. It’s an active, high-risk approach to online trading.

In Russia, short-term traders can access various financial instruments, such as:

• Shares from companies traded on MOEX, such as major fertilizer firm Acron (AKRN) and natural gas titan Gazprom (GAZP).
• Indices like the MOEX Russia Index (IMOEX.ME), which provide exposure to a broad swath of large-cap Russian companies.
• Commodities like oil, natural gas, gold, palladium, platinum, nickel and wheat, with Russia among the largest producers globally.
• Currencies paired with Russia’s ruble (RUB), though sanctions in recent years have limited access to the likes of USD/RUB and EUR/RUB, affecting both spot and derivative instruments.
• Cryptocurrencies have been gaining ground among Russian traders after being legalized through State Duma legislation in 2024.

CFD trading in Russia is also big business – providing a derivative instrument to speculate on rising and falling prices without owning underlying assets, with leverage to amplify results (profit and loss).

Global sanctions have impacted Russian traders’ ability to deal a variety of international instruments.

For example, the EU has banned the sale of securities to Russians; meanwhile MOEX and Russia’s central bank have restricted trading in euros and dollars.

Many forex brokers and crypto exchanges, such as Interactive Brokers and Binance, have also limited trading services for Russians.

Michael MacKenzie

Author

Is Day Trading Legal In Russia?

Yes. Citizens of Russia are free to open and close trading positions within a single day.

The Central Bank of the Russian Federation (CBR) oversees the financial sector, including online trading activities.

Yet while the CBR is well-established in Russia it faces some criticism further afield:

How Is Day Trading Taxed In Russia?

Although profits from assets that are held for the long term may be tax-exempt in Russia, active traders may need to count their day trading profits towards their usual income tax bill when they file with the Federal Tax Service.

Russia has a relatively low progressive tax rate that starts at 13% for incomes up to 2.4 million rubles, rising to a maximum 22% rate for those with incomes above 50 million rubles.

The Russian tax year matches the normal calendar year, running from 1 January to 31 December. Taxes should be filed with a Tax Declaration form by 30 April, and the final date to pay taxes is 15 July.

Getting Started

These three steps will help you begin your day trading adventure in Russia:

1. Sign up with a top Russian day trading broker: Find a trustworthy, regulated brokerage that offers the assets you want to trade, such as MOEX-listed equities. Also look for fast, reliable execution, an excellent charting platform, timely support, and low trading fees – essential ingredients for active traders.
2. Open an account: You’ll need to prove your identity to open an account, so have your Internal Russian Passport handy. You’ll also need to fund your account before you start trading – it’s a good idea to sign up with a broker that supports accounts in RUB and WebMoney or Yandex Money, as these are among the most convenient funding solutions in Russia.
3. Choose an asset to trade: Russian stocks like Sberbank and commodities like oil are popular among day traders owing to their significant volume, volatility and potential Russian influence. Use technical analysis and risk management practices to inform your decisions and protect your rubles from excessive losses.

A Day Trade In Action

Let’s look at Russia’s Gazprom (GAZP) to demonstrate how a day trade could work…

When I was researching trading opportunities, news of the Russian energy giant’s worst losses in 25 years sent the stock plummeting from RUB166 to RUB155 in just four days.

However, I spotted a news event that I believed could help GAZP retrace some of its losses. My thesis was that news of improving energy demand in China, one of Russia’s main trading partners, could lead to a recovery the following week.

Nevertheless, I still saw this as a risky trade since my analysis had revealed Gazprom’s situation to be troubled by the loss of significant parts of its trade with Europe. So, I plan to exercise tight risk management by setting stop loss and take profit orders close to my entry price.

The price had already risen by RUB1 to about RUB155 by the time I was able to place a market order. I set my stop loss at RUB153 and my take profit at RUB159, hoping to catch some gains and get out while protecting myself with a 1:2 risk-reward ratio.

This time my intuition proved correct, and I exit with a RUB4 profit per share before trading costs with leverage multiplying my results.

While I might have made more by keeping the trade open for longer, my risk management protected my trading funds from large, unexpected price movements in a volatile security.

Bottom Line

Despite challenges raised by the country’s relations with the West, notably Europe and the US, day trading is popular in Russia and traders continue to speculate on MOEX stocks, energy commodities and more.

However, it’s essential to abide by the regulations laid down by the CBR and tax requirements from the FTS. Also be aware of the risks – you could lose any rubles you invest.

To get going, check out DayTrading.com’s pick of the best day trading brokers in Russia.

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