Lots of strategizing to do into this weekend with the events expected in Crimea. I'm not sure the trade is to short Russia at these levels. Russia currently trades at 0.53x P/B e'14 and 5.54X 'e'14 PE. These levels are extreme even by the Russian standard which is always one of overshoot. So despite the prospect of weekend events that only further isolate Russia and pressure on the MICEX Index, we are not advocating selling Russia but rather... We are advocating looking at call levels, slightly out of the money, on the RSX. March $23 or even $24 monthly calls are where the value is. A quick look at the chart on Russia and you can see that the index is well through the June lows when measured in USD terms. In other words, if you are a US investor and playing Russia you care about Ruble returns as well. Local Russian investors care less about FX in terms of their total return. The Index is -14.5% from the June lows which have otherwise been a backstop for all other EM markets (other than Turkey).
Look at protecting your book through western European hedges. The DAX is a great place to own cheaper volatility and has high correlation to Russia. Germany has significant interests in Eastern Europe and its banks are exposed to a number of developmental programs in the region. They have long been focused on the Russian relationship more than their western neighborts.
German DAX correlation to Russia when it is selling off moves up. Over the last month German DAX correlation to the Russian MICEX index has gone from 0.57 on a longer term basis to 0.79. This is a highly sensitive move and clear a 0.8 correlation of anything to something else is high. Take your short bets to Germany. Play the German ETF EWG or even a small basket of key German multi-nationals like Deutsche Bank(DB), Siemens (SIE), and Volkswagen.