Currency market of the Moscow Exchange. Currency trading on the Moscow Exchange

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

The Moscow Exchange was formed a few years ago (in 2011) on the basis of the MICEX (Moscow Interbank Currency Exchange) and RTS (Russian Trading System) formed in the nineties of the twentieth century.

The created holding also includes CJSC "National Settlement Depository", which is a non-bank credit institution, and CJSC JSCB "National Clearing Center".

The shareholders of the Moscow Exchange holding, among others, are such major banks as:

• Central Bank of the Russian Federation (more than thirteen percent of the shares).
• Sberbank (about ten percent).
• Vnesheconombank (about eight and a half percent of the shares).
• EBRD (almost six percent).

The chairman of the board is A. Afanasyev, and the chairman of the board of observers is A. Kudrin.

Moscow Exchange gained popularity relatively quickly, entered the twenty largest stock markets in the world and the ten leading stock exchanges in the world in terms of financial derivativestools.

Moscow Exchange, foreign exchange market: trading

Various operations are performed on the stock exchange:

• With securities. The stock market here consists of the equity market (stocks, investment fund units, depositary receipts, mortgage certificates, T+2 bonds) and the debt capital market (T+0 bonds).
• With precious metals. Settlements occur at different times, from one day to six months. Trades are conducted with gold and silver. With other precious metals, you can enter into futures deals.
• With productive financial instruments and commodities of large demand through the derivatives market.
• With currency. In addition to the Russian ruble, the Moscow Exchange has in its arsenal the dollar, the euro, the Belarusian ruble, the Ukrainian hryvnia, the Chinese yuan and the Kazakh tenge.

Trades on the Moscow Exchange are held on working days according to the schedule. Different markets have different trading times. For the foreign exchange market, working hours are from ten to half past six; in the mode of off-system transactions - up to twenty-three hours and fifty minutes.

Private investors in the foreign exchange market

The currency market of the Moscow Exchange used to be available only for banks, but for some time now, brokerage companies have also received permission to trade. And to receive speculative or investment income, the services of the Moscow Exchange can be used byprivate investors. However, they will not be able to trade directly, so they come here through brokerage firms that are allowed to trade.

On the official website of the Moscow Exchange you can find a list of trading participants. To date, there are about seven hundred such organizations. The vast majority of them are banks, and only a small part, namely five percent, is accounted for by brokerage companies. The Moscow Currency Exchange is a platform primarily organized for trading in foreign currencies at the Single Trading Session (UTS for short).

Through brokerage companies, private investors can trade currencies, securities, precious metals, options and futures.

But, as a rule, most private investors trade in the foreign exchange market.

Trading volume on the foreign exchange market

What is the trading volume of the Moscow Exchange currency market? In 2012, it amounted to one hundred and seventeen trillion rubles.

In 2013, the currency market of the Moscow Exchange grew by thirty-three percent and amounted to one hundred and fifty-six trillion rubles (compared to the previous year). With low currency volatility, trading in the spot market fell by almost seven percent, while swap transactions, on the contrary, increased significantly - by seventy-eight percent. The factors that contributed to the growth of Russian and foreign participants were the emergence of new exchange products and the increased convenience of working on the market.

In 2014, the growth was forty-six and a half percent (according tocompared to 2013). When the Central Bank let the ruble float freely, only in December the Moscow Currency Exchange recorded trades in the amount of 25.6 trillion rubles, of which ten trillion were cash transactions, and the rest were swap transactions. This is almost ten trillion rubles more than in December of the previous year.

One of the representatives of the exchange explained such a large increase in investments and interest rates by the fact that market participants held a large amount of currency in rubles. That is why the interest income was so high. The rate level also helped increase income during the currency crisis.

In general, percentage income is about half of all income of the Moscow Exchange. For example, on the London Stock Exchange, interest income was around five percent, and on the Warsaw Stock Exchange in 2014 it was zero.

Forex and Moscow Exchange: differences

The currency market of the Moscow Exchange and Forex have cardinal differences. Let's take a look at some of them.

Ninety-nine percent of the "kitchens" of Forex do not bring orders to the interbank market. They remain within a company, often registered in an offshore zone, sometimes only positioning itself as Forex, in fact, not being one. It is with these companies that the comparison is made below.

1. Regulation

The currency market of the Moscow Exchange is regulated by acts adopted by the Central Bank of Russia, internal rules and regulations. Forex companies are often offshorezones, some of them are essentially fake, not included in the registry at all, although they position themselves differently.

2. Application status

On the Moscow Exchange, orders submitted through a broker enter the market and become visible to all participants in the market. An order submitted through a Forex broker will remain inside the company's system and will not be visible on the market.

3. Transaction Guarantees

It is not enough just to make a deal, it is important to get money in the end. Settlements on the Moscow Exchange are carried out by National Clearing Center CJSC, while Forex brokers often provoke conflicts in order to deny profit.

4. Possibility and lack of influence of the broker on the currency price

The rate on the Moscow Exchange is set jointly, with the participation of all bidders. In Forex, you will have to trade with the company itself, which can easily delay the quote, or, for example, increase the spread between the ask and the bid. The broker itself cannot influence this here.

5. Who is the counterparty

The Moscow Exchange has another advantage. Dollar, ruble, euro or other currency is used in trading with the entire market, and in Forex - against a broker. Therefore, a Forex broker is directly interested in the loss of his client.

6. Cash currency

The purchased currency can be stored in a bank account. There is no such possibility in trading with a Forex broker.