In the wake of Russia’s invasion of Ukraine, Moscow’s stock market has been shut down, and Russian shares first plummeted on other exchanges, and then were frozen. It’s a reminder that government policy can’t always keep markets afloat; sometimes it devastates them, and markets can dry up or die altogether, writes Jason Zweig in The Wall Street Journal.

A market’s closure is usually caused by war, as was the case in 1914 when the New York Stock Exchange closed from July to December of that year to avoid panic over the start of World War I. Outside of the United States, trading in major markets was stopped at least 25 times in the 20^th century, proving that markets are not permanent fixtures.

It’s another reason why diversification is vital, Zweig writes: if you held Russian ETFs before the invasion, you were still able to get out for a short time, albeit at a loss. But on March 4^th, the NYSE Arca exchanged halted all trading in iShares MSCI Russia, Franklin FTSE Russia, and Direction Daily Russia Bull 2X Shares, which said it will liquidate on March 18^th. And other available ETFs are likely to be halted by CBOE Global Markets. That leaves nowhere to go for retail investors who want to trade Russian securities, unless they choose to hold out for a reopening of Moscow’s market. That would be a risky bet: not only would Russia have to honor those property rights, their shares would also have to hang onto their value. It’s more likely that other Russian ETFs will liquidate and distribute what cash they have back to investors.

While some Russian companies are listed on other markets, their prices/earnings ratios have now below 1.0. The energy company Gazprom PJSC closed at $1.10 over the New York counter on March 3^rd, after hitting $8.97 on February 16^th, and Sberbank Russia PJSC was down to 52 cents from $14.76 in the same time frame, the article details. But if Putin chooses, he could nationalize every major company in Russia and forgo the market altogether, making real what the chairman of the Leningrad Stock Exchange predicted at its opening in 1991: “…we will return to the old distribution system,” he foretold, “…and in this case, I see no need for our stock exchange.”