Should We Be Buying Rubles Right Now?

In light of Russia’s war with Ukraine, massive sanctions have hit the Russian economy hard. Having fallen to below $0.01 and remaining very volatile still, the Ruble has fallen to an all time low.

This is not the first time Russia’s currency has plummeted like that but they have bounced back before. As somebody with no considerable financial expertise, the natural question on my mind was should I invest in this falling currency and can I make a few bucks from it?

So, I did a bit of research and have put together a few pros and cons that I’d love to share with you. Mind you, I am not speaking from any position of expertise but from my own perspective as a layman to share my findings with others in my position.

Why We Should Buy The Ruble Right Now

Right now, the currency is at an all time low and that just means we can get it cheaper and can stand to make even more profits when it does eventually recover. We could hold them in a foreign exchange account and swap them out for dollars when the time comes or we could also hold on to actual physical Rubles too.

Basically by investing in Rubles we can stand to either make some money back when the value goes up or if we are able to, use the actual Rubles to buy things at cheaper prices. Some people could also consider “short-selling” the Rubles for a quick and fast profit.

There have been a few notable times in history where the Ruble has plummeted and eventually recovered. A recent example was in 2014 during the Annexation of Crimea. This shows that at least theoretically, we could invest a bit in Rubles and eventually make ourselves a half-decent profit.

However, these should be weighed against a few other points as well.

Why We Shouldn’t Buy The Ruble Right Now

While we could theoretically profit from buying the Ruble and waiting for it’s value to rise, the reality is that we don’t know when exactly that will be. This early on in the conflict, even the most skilled economists would not dare to predict when this time would come.

On that same note, the volatility of the Russian market and the unpredictability of the whole situation may mean that the Ruble could continue to fall even further past this point. In similar situations in the past, experts have warned would-be investors to “not catch a falling knife.”

With all the sanctions in place, it is difficult to even purchase Rubles. Banks have begun to restrict the purchase and trade of the Ruble so it will become hard for us to do so much as even pop by the local money changer and swap out a few bucks for some Rubles.

It seems that the biggest factor for why we shouldn’t buy Rubles at this time is the sheer uncertainty of the situation. If even the experts have no clue when the price will rebound, what chance does the average person on the street have to make a few bucks? If anything it seems that buying Rubles is a high risk game with significantly low rewards.

Conclusion

As a layman, I have grown to understand that there may be potential in buying Rubles and making at least a small profit. However, I also realize that many unpredictable and unprecedented factors may point towards the fact that this may not be the best time to make such an investment.

The value of the currency is too unstable and the currency itself is becoming more and more difficult to obtain and trade with each passing day. Thus, as of this writing, it probably will not be in anybody’s best interest to be buying Rubles and hope to make some quick money. That being said however, it wouldn’t hurt to monitor the situation some more and wait for new information to come out.

If you are like me and thought you could profit off buying Rubles right away, I wouldn’t discourage you from doing so at this point. All I suggest is to wait for the situation to become more stable and for information to be more available so that you can make an informed decision. On that note, you better be prepared to wait quite a while.