26.04.2016 15:05

Moscow Exchange announces FX Market enhancements

From 4 July 2016 Moscow Exchange will offer new opportunities and services to FX Market participants. The Exchange will expand its FX product offering, introducing new services to member firms and their clients and improve the risk management system.

"In recent years, Moscow Exchange"s FX Market has transformed from a segment of the domestic interbank market to the global trading platform for ruble operations. Today, it is the main marketplace for FX transactions and the centre for establishing the national currency rate," said Alexander Afanasiev, CEO of Moscow Exchange. "The market enhancements we are announcing today will create new business opportunities for market participants and their clients in FX trading and risk hedging, with fast and effective technology providing new strategies to combine spot and long-tenor FX instruments. This will facilitate market liquidity, and reduce costs and risks for Russian and international participants."

Deliverable futures

Deliverable futures contracts on USD/RUB, EUR/RUB and CNY/RUB currency pairs will be launched. The contract lot will be 100,000 currency units, with a tick size of RUB 0.01 for USD/RUB and EUR/RUB and RUB 0.001 for CNY/RUB. Contracts will be settled quarterly on fixed dates. The new deliverable futures can be offset with swaps on the same underlying assets.

New currency pair

The CHF/RUB currency pair will be launched to calculate risk parameters for CHF-denominated bonds, in order to admit these bonds to repo with the CCP and make the currency eligible as collateral. 

In the initial stage, instruments with TOM and TOD settlement, as well as swaps will be offered.

Risk management

Collateral requirements will be reduced for opposite positions in EUR and USD thanks to an inter-product spread, allowing trading firms to reduce their funding costs. To unify collateral calculations, interest risk will be considered for TOM positions and margin requirements will be issued for overnight swaps similar to long-term swaps.

To manage client risk, trading accounts will be registered for second and third tier clients, giving brokers access to the Exchange"s risk management tools and allowing them to keep records of clients" positions. Settlement and collateral nettings will be available under the settlement code in which the positions of different clients are recorded.  

The opportunity to withdraw funds up to the same amount as the surplus in their current position means participants will be able to manage their assets more effectively within a day and continue with TOM settlement trading.

As MOEX continues to roll out segregated accounts to end clients, brokers will be allowed to see payment details so that they can check whether a beneficiary and a segregated client are the same person, meaning that funds of segregated clients can be protected.  

For further information, please contact the Public Relations Department at (495) 363-3232.

Main news