Foreign currency is a currency notes, which are legal tender of the State.Their exchange of each other is carried out within the foreign exchange market, namely the system of economic relations between banks and their clients, professional actors and public institutions.Purchase and sale transactions are concluded exclusively in non-cash form.
OTC Market
currency trading can be carried out in two areas: on the organized and OTC markets.
OTC transactions are concluded directly between the buyer and seller exchange.As a rule, this is the role of commercial banks.And how they can make deals on their own behalf and for their own needs, and to represent the interests of clients.The buyer and the seller in negotiations determine the conditions of purchase and sale of foreign currencies, which include the amount, rate, terms and payment arrangements.A special feature of trading on the OTC market is the fact that both sides are taking on certain risks (in fact, any of them may at any time abandon its commitments), so these operations are carried out between the partners who trust each other.
organized currency market
Exchange trades in the foreign exchange market suggest the presence of a third party, namely, the organizer of trading - Currency Exchange.In this case, as it is the negotiation process between buyer and seller.Each of them takes on the exchange application with the conditions of the deal that suit them.If at any point in time the interests of the buyer and seller agree, the operation is carried out automatically.The Exchange not only simplifies the process of transactions, it is also a kind of guarantor.Therefore, neither the buyer nor the seller makes no difference who is acting as the second party.The deal can be struck only if each of its members available to the required amount of the relevant currency.
possible and another option such operations when the negotiations between the parties are directly and all payments go through the stock exchange.This is done in order to eliminate the risk of default by one of the parties of their obligations under the transaction.
MICEX: history of occurrence
Moscow Interbank Currency Exchange is a major trading floors of Russia.The group includes the MICEX stock and commodity exchanges, MICEX clearing center, the National Depository and regional settlement centers.
MICEX was founded in 1992.Currency operations from the very beginning its main activity.Sections trade stocks, bonds, and commodity derivatives were held too late.
At the end of 2011 there was a merger of the two areas of the Russian stock market - MICEX and RTS.This combined structure was named Moscow Exchange.Since currency trading on the MICEX held in a single exchange area.
Technical evolution enter into foreign exchange transactions
Initially, trading on the MICEX were in the form of auctions.The so-called "broker" is going to request of buyers and sellers with an indication of the amount of foreign currency and the exchange rate.Then a competition, the results of which determine the winner.
On June 2, 1997 currency trading on the MICEX began to take place in the electronic trading system (SELT).SELT It was the first such a system of exchange market of Russia.This was truly a revolutionary breakthrough in the field of organized trade.With the help of the buyers and sellers were able to enter an unlimited number of transactions during the trading session in real time.
conclusion of transactions on the MICEX
transactions on the MICEX conducted through electronic trading system.Its meaning lies in the fact that each participant submits an electronic application indicating the amount of currency bought or sold and the price at which he is willing to make a deal.All of them come in a single system.When two bids for the purchase and sale of the same price, they are executed automatically.The volume of the deal will be equal to the smaller volume of two executable instructions.
Outstanding requests that were queued can be removed at any time, if you put her party wants to change the conditions.
It SELT enables currency trading in real time.Setting, changing and cancellation of orders and transactions at the current rate are reduced to a simple click of a button.For the convenience of participants have exhibited instructions displayed on the computer screen.This allows you to assess the current state of the market and predict its possible direction.
order of execution of electronic orders
If the price of the application does not meet the current level, then it takes one of the following:
- for application to purchase foreign currency.If its price below the current market rate, it is queued and will be executed if the quotation drops to a certain level.If the above - it is executed on the market.
- for applications for foreign currency sale.If its price below the market rate, it will be met at the current quote.If the above - will be queued until such time as the value of the currency does not rise to the level specified in the application.
Trading Schedule
currency trades are conducted in accordance with the approved schedule.Transactions with the "today" of the dollar-ruble pair are in the period from 10:00 to 17:15 hours Moscow time, the euro-ruble - from 10:00 to 15:00 Moscow time.Bidding other instruments (Belarusian ruble, the Kazakh tenge, Ukrainian hryvnia and the Chinese yuan) held just one hour, from 10 to 11 pm Moscow time.
MICEX also offers its participants the opportunity to enter into transactions in the so-called non-systemic mode of transactions.They combine elements of exchange and OTC markets.Parties to the transaction directly negotiate all of its conditions.But the purchase and sale transactions carried out in the framework of the electronic exchange space.The buyer and the seller put targeted applications.Get the other party it can only be a particular party for which she is exposed.The conclusion of such deals on all currency pairs possible up to 23-50 Moscow time.
value of organized currency market
organized currency trades within MICEX perform several important functions.
First of all, with their help, everyone can participate in the process of pricing.To do so may as a professional participant received immediate access to trading, and absolutely everyone who does not have the world of finance in any way.To do this, he needs to enter into an agreement with a broker who has direct access to the stock exchange MICEX.In this case, it will have to represent the interests of his client.
Second, the central bank as a state body regulating in the field of monetary policy has an impact on the current exchange rate of the national currency, it intervenes in the framework of MICEX.In addition, the results of currency trading taken into account when establishing the Bank of Russia official exchange rates against the ruble.
MICEX is, without exaggeration, the main venue of the exchange market of Russia.MICEX currency trading today are one of the instruments of state monetary policy.It is this area gives its participants the opportunity to enter into transactions in real time.The volume of currency trading is constantly growing.In 2002, they amounted to 65 billion USD., In 2008 - 2.7 trillion dollars., In 2014. Only in January the figure was more than 13 trillion rubles.
