What is MICEX and RTS? Moscow Exchange MICEX-RTS

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:47

What is MICEX and RTS is already known not only to professional traders, but also to ordinary people. Exchange trading has become a familiar part of everyday life, a stable topic of news feeds, it is discussed at the state level. But how does Russian trading work? What factors affect stock prices? What was special about trading securities during the financial crisis? What are the principles of operation of stock exchanges and what are the features of the history of the Russian trading market?

What is a stock exchange

Stock exchanges are organizations that are financial structures where the owners of shares and other securities make numerous purchase and sale transactions. As a rule, this happens through intermediaries. Exchange participants are securities traders and various financial institutions. Trading is carried out in accordance with the internal rules and regulations of the financial institution. A distinctive feature of the stock exchange from others is that only securities are commodities.

Their value is formed by the mechanisms of supply and demand, buying and selling takes place in accordance with the regulations. Experts define severalfunctions of stock exchanges. Firstly, it is mediation, creation of conditions for the purchase and sale of securities with the participation of issuers and investors. Secondly, it is an indicative function - an assessment of the price and attractiveness of shares. Thirdly, this is regulation - in fact, the definition of rules and norms of trade. The history of trading in Russia knows three major exchange brands: Moscow Exchange, MICEX, RTS.

MICEX: from Soviet origins to the present

MICEX (Moscow Interbank Currency Exchange) appeared in 1992. But it is worth noting that the first such financial institutions emerged in Russia in the late 18th and early 19th centuries. In Soviet times, stock exchanges did not work. MICEX originates from currency auctions organized by Vnesheconombank. In the second half of the 1990s, futures and corporate securities began to be traded on the stock exchange. The active work of the MICEX continued even during the crisis of 1998.

In the 2000s, the volume of trading on the exchange began to amount to hundreds of billions of dollars. Hundreds of companies have been quoted here. More than 200 of them have a total capitalization of over $300 billion. Shares on the MICEX are traded by the largest Russian companies: Gazprom, Lukoil, Rostelecom.

RTS: years of "independence" and merger with MICEX

For a long time, the MICEX coexisted with another exchange, the RTS, which was established in 1995. Immediately after the launch, she had a special index. For the securities market of the Russian Federation, it has become one of the key ones. In 2000 appearedMoscow Stock Exchange RTS, and based on it - the FORTS market (known for options and futures). Since 2005, anyone could trade anonymously via the Internet. Online trading has become so popular that most Russian-speaking netizens have begun to understand what MICEX and RTS are and why these structures were created.

In 2007, the financial solution RTS START appeared, which allowed small and medium-sized enterprises to trade securities. Thus, the exchange turned into a financial instrument, the capabilities of which were useful to the widest audience: from ordinary citizens to any type of business. In 2008, at the initiative of the RTS Moscow Exchange, the Ukrainian Exchange appeared. Thanks to this, Ukrainian citizens got the opportunity to trade shares via the Internet. In 2008, the ruble stock market appeared on the RTS, where the most liquid assets issued in Russia were traded. At the end of 2011, both financial institutions merged into OJSC Moscow Exchange. MICEX, RTS, their projects and decisions, nevertheless, played a major role in the development of the Russian stock market.

Factors that determine share price

The main indicator of the value of securities on stock exchanges is quotes. They are most often expressed in points or currency units. The factors that determine the MICEX and RTS quotes are generally based on market laws typical of other exchanges. First of all, these are indices on other trading floors. The situation in the world greatly affects the Russian stock exchanges. Quotesreflect, as a rule, profitability of the company. The higher it is, the higher the points on the exchange will be. Another factor is the policy of the authorities both in the foreign arena and within the country. If things are not going well in relations with other states, then this threatens with investor distrust and capital outflows.

Foreign traders had a good time to study the Russian stock market. They know what the MICEX and RTS are, as well as their legal successor in the face of the Moscow Exchange. Therefore, having received a negative signal from the political arena, they may decide to withdraw capital from Russia. Firms' share prices are affected by the release of revenue and loss data. Securities of successful businesses are bought better and grow in price. The most important factor, especially for Russia, is oil prices. When the crisis began to approach, many traders wondered: "What is it?" MICEX and RTS, it seems, showed excellent results, but suddenly the quotes collapsed at times. The matter turned out to be the price of "black gold", which fell just as significantly.

Interesting about MICEX

MICEX, according to some analysts, is the largest stock exchange in Eastern Europe. Experts note that foreign investors are very sympathetic to this financial structure. The MICEX is trading in shares, shares, bonds, deposit receipts. The exchange allows negotiation transactions, REPO, anonymous purchase and sale. Here you can trade options and futures. Along with the RTS, the MICEX actively developed Internet technologies during the formation of the market. Online stock tradingthe exchange began to implement since 1999.

Interesting about RTS

RTS in the years of "independence" was considered by many market experts to be Russia's largest electronic exchange. Among its notable properties is reliability. An RTS technical center was created to maximize the stability of the exchange. Some experts are sure that there are no analogues to the programs created by this structure in Russia.

Any stock exchange - RTS, MICEX, their foreign counterparts - has an infrastructure designed to ensure safe and stable communication between the issuer of securities and the investor.