The concept of buying when there is “blood in the streets” is well-known to most investors, particularly as a figurative expression that calls for moving into beaten-down sectors when they’re really out of favor. Yet when there’s literally blood in the streets, it’s probably wise to steer clear of stocks in the hot zone.

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Traders certainly steered clear of the hot zone between Russia and Eastern Ukraine at the beginning of the year. The Market Vectors Russia ETF (NYSE: RSX) tumbled roughly 25% in the first 11 weeks as the tensions between the former Soviet Union and Ukraine culminated with Russia annexing the Crimea region in strong-arm style.

However, following the multiyear low in RSX in mid-March, Russian stocks have been strong performers. RSX is up 20% since its March 13 low, more than double the gains in the S&P 500 over the same time period.

Renewed tensions in the region in July sparked by the shooting down of a Malaysia Airlines passenger jet by pro-Russian separatists caused another big sell-off. This quickly took RSX below its 50-day and 200-day moving averages, as once again the literal blood in the streets (or skies) caused money to flee the region.

Still, the allure of investing in one of the largest economies in the world, and one with an abundance of natural resources such as oil, timber and precious metals to name just a few, is something traders can’t seem to stay away from. Moreover, the latest political developments between Russia and Ukraine could mean it’s time to get long RSX.

On Sept. 3, Russian stocks soared on word of a ceasefire agreement between Russia and Ukraine, with RSX spiking 6%. A ceasefire was agreed upon two days later and is obviously something the Western world welcomes. It’s also something traders are betting on, as evidenced by the strong buying last week.

So, can RSX continue to push higher from here?

According to Daniel Wood, fixed-income portfolio manager at Fischer Francis Trees & Watts, “If this is the positive catalyst we have been awaiting regarding improved diplomacy between Russia, Ukraine and the West then it represents a great opportunity to purchase Russian assets at a deeply discounted valuation.”

I agree with Watts, and traders who buy RSX now can get exposure to some pretty strong companies at conflict-inspired discounts. Among its top 10 holdings are oil giants Gazprom and Lukoil, financial firm Sberbank, natural gas producer Novatek, and metals and minerals firm Norilsk Nickel.

As you might expect from a natural resource-rich country such as Russia, RSX is heavily weighted to the energy sector (about 40%). Basic materials companies make up about 18% of the ETF’s holdings, with communication services comprising 14% and financial services 11%.

If you’re a blood-in-the-streets-type trader who isn’t afraid to bet on stocks in a politically charged region, then I think the latest ceasefire news between Russia and Ukraine means RSX deserves some of your risk capital.

Recommended Trade Setup: 

— Buy RSX at the market price
— Set stop-loss 10% below entry price
— Set initial price target at $28.75 for a potential 15% gain in two months

P.S. If gains from an overlooked stock like this excite you, you have to check out what my colleague Frank Bermea calls ‘The Alpha Score’. It’s a secret indicator that only a few dozen people know about — but it’s able to flag exactly which stocks are about to jump double or triple-digits days… weeks… even months before it happens. It’s already flagged 71 stocks that gained 10% or more in just two weeks. Click here to find out more about the ‘Alpha Score’ — and get the name of its latest stock flashing “buy” now. 

This article originally appeared on ProfitableTrading.com: Blood-in-the-Streets Trade May Bring Brave Traders 15% in 2 Months