Moscow Stock Exchange: characteristics of the trading platform

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

For Russian traders and investors in the sphere of trading in securities, currencies, contracts or precious metals, the main competitive platform in the vastness of the Russian Federation is the Moscow Stock Exchange. It is the largest Russian exchange holding and ranks among the twenty largest in the world, and is also among the top ten in terms of trading volumes.

How was MICEX created?

It was created in 2011, although the history of the opening of the first exchanges goes back centuries. Back in the 60s, securities trading was already present on the created Russian sites. In 2011, after the merger of two large exchanges, which represented the largest Russian stock exchange for trading shares, currencies and derivatives, the MICEX-RTS Moscow Exchange was founded. Later, in 2015, it changed its name to PJSC Moscow Exchange.

Technologies and Features

Today, the Moscow Stock Exchange is serviced on the technological platform T+2. The technology was adopted from European experience, as a result, this particular trading system has been used on the stock market of the Moscow Exchange for three years already.

Earlier trades were conducted on the basis of Т+0 technology. The difference was that under the T + 0 system, the transaction must be completed on the day of its completion, while the introduction of the T + 2 technology made it possible to reduce the costs of market participants. This increased the liquidity of the market and the influx of non-residents, who are already accustomed to conducting transactions on European sites. T+2 is characterized by a partial preliminary deposit of funds and has the ability to make transactions with deferred execution for up to 2 days. The big plus is that in using this technology there is a slight similarity with futures trading, which adds liquidity. Exchange electronic platforms are interested in this.

Basic information

Moscow Exchange Tasks:

• currency conversion by trading;
• determination of the ruble exchange rate in relation to other currencies;
• ensuring the circulation of investment capital in the economy, etc.

The trading schedule is divided into a day session (10:00-18:45) and an evening session (19:00-23:50). During the afternoon session, you can make orders over the phone.

Moscow Currency and Stock Exchange: Benefits

The main advantages of the Moscow Exchange are reliability, accessibility, low commission fees, no depositary fees, high liquidity, constant changes in the list of contracts, the ability to quickly respond to changes in the dynamics of foreign exchanges using the evening session. Various events are held on the Moscow Exchange, whichaimed at the economic education of the inhabitants of the Russian Federation. This includes lectures and conferences involving students. An integral factor is the creation of charitable projects that bring great benefits not only to the population, but also to the country's economy.

The Russian stock market is still very young and developing. Compared to the US market, the Moscow Stock Exchange is far from perfect. One of the main criteria for a trader is liquidity.

What does that mean?

It all depends on the average daily trading volume of the stock. On the Moscow Exchange, it is $1.1 billion, but compared, for example, with the NYSE, whose volume exceeds $300 billion, this is very little. To equal the volumes of the American site, the Russian market needs to work for about a year. It can be concluded that the liquidity of the US markets exceeds domestic stock electronic platforms.

The policy of the country, of course, affects exchange trading. In the CIS countries and the United States, the stock market is freer, and if the politicization is calculated as a percentage, then approximately 10% can be given to the US markets on average, and all 90% to the Russian ones. This means that the shares of the Moscow Stock Exchange cannot be called valuable, but still ahead. This sector of the economy is developing rapidly, so experts do not express any concerns.

Despite its recent existence, the Moscow Stock Exchange has already achieved great success not only in Russia, but also in other countries. She occupies not the lastplace in the top of the largest exchanges in the world in terms of trading volume and brings great benefits to the social and economic development of the country.