Russia has been gold for hedge funds this year

Russia and Brazil face a common problem

Judging by the headlines, Russia may look like a nation in turmoil. Investors, though, don't seem to mind.

In fact, for hedge funds, Russia has been one of the biggest and best stories of 2015, turning in the only positive performance among all emerging market strategies and crushing the returns of traditional stock market indexes like the S&P 500.

The Russia/Eastern Europe Index returned 6.71 percent through August, according to the latest numbers from HFR, which tracks returns in the $3 trillion hedge fund industry.

This has come despite Russia's economy being in tatters, as gross domestic product contracted 4.6 percent in the second quarter. The nation has become a pariah on much of the global stage thanks to the conflict in Ukraine and its assistance to Syrian strongman Bashar Assad. Yet the investment returns pour in.