MOEX lifts restrictions on repo transactions, including short positions

abdelaziz Fathi

Russia’s largest institutional trading venue has lifted restrictions it applied last month to repo transactions with a central counterparty (CCP) in US shares.

Moscow Exchange (MOEX)

In a statement, the Moscow Exchange (MOEX) said on Tuesday that effective January 31, banks and brokers will be able to enter into repo transactions with the CCPs over the record date and also open short positions in US securities. MOEX has also abandoned the +/-20% price range restriction it applies right before the record date.

MOEX plans to make more international securities available for trading in the future based on demand from banks, brokers, asset managers and their clients. The exchange has recently ramped up its listings and extended the hours during which stocks can be traded in a move aimed at attracting a greater number of investors.

MOEX has seen a flurry of IPOs and secondary offerings as the regulators continue to simplify the investment environment and remove obstacles to new listings. The exchange first launched trading in international equities in August 2020.

Overall, there has been a jump in retail activity throughout 2020 and 2021. Amid concerns over the economic impact from the coronavirus outbreak, there was a brighter side for all trading platforms, which attracted a rush of business as investors scrambled to protect portfolios.

MOEX, which runs one of the largest FX trading platforms, revealed in October that it raised its stake in BierbaumPro AG, whose main asset is the OTC FX platform NTPro. The transaction increased MOEX’s ownership from 29.5% to 95%.

Currency trading at MOEX continued its upward route in December, buoyed by a steady rise in volatility and coupled with a multi-year effort to bring new business to the platform.

MOEX’s total FX market turnover edged higher to RUB 31.9 trillion ($424 billion) last month, up 22 percent month-over-month from the RUB 26.1 trillion ($350 billion) exchanged hands in November 2021. Compared with volumes from the same month a year earlier, this figure was down 2.3 percent from RUB 32.8 trillion in December 2020 but virtually unchanged in dollar terms.

 

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