Repo trades with the Central Counterparty

On RTS Standard you can enter into repo trades with the Central Counterparty (CCP). This service enables market participants to lend and borrow cash and securities without running a counterparty risk. This significantly broadens the range of entities executing repo trades.

Effective September 7, 2010 RTS Standard will support repo trades in the anonymous trading mode (repo trades in the order book) with the Central Counterparty. Functionality for direct repo trades was implemented in April 2010.

Anonymous repo trade is a repo trade executed based on indirect orders submitted by market participants. These trades are made in a continuous double auction of orders, i.e. in the order book. The first leg of the repo trade is settled on the trade date (Т+0), and the second leg is settled on the next day (Т+1). This means that 23 new instruments are added to the trading system (Т+0, T+1 "order book"), and you can enter orders and track rates on the repo market.

Direct repo trade is a repo trade executed based on direct orders. Market participants can submit their orders specifying the counterparty they would like to make a repo trade with. However, the counterparty risks are still assumed by the Clearing Center acting as the Central Counterparty. The settlement cycle for direct repo trades can vary from Т+0 to Т+4.

Advantages of making repo trades on RTS Standard

• Settlement guarantees provided by the Central Counterparty for repo trades executed on RTS Standard resolve the bilateral credit limits issue. In the event of default by a counterparty the CCP ensures settlement of the obligations to the fair counterparty. No need to set up bilateral limits. The CCP guarantees will allow you to enter into repo trades with a wider range of counterparties and mitigate counterparty risks associated with such trades.
• Repo trades can be executed in the most liquid shares of Russian issuers admitted to trading on RTS Standard. The list of these shares is being consistently expanded by the exchange.
• Netting of obligations arising from positions with coinciding settlement dates for all types of trades.
• Margin calls are given taking into account the joint portfolio made up from positions on RTS Standard and FORTS (portfolio-style approach to positions margining).

Benefits of making anonymous repo trades on RTS Standard

• Cutting costs and saving time, as there is no need to establish bilateral limits between counterparties to the trade.
• Crediting cash and securities for final settlement on the delivery day. With the option to transfer settlement obligations under trades executed on RTS Standard to a later date, you can avoid posting cash and securities right for settlement until the delivery day. This allows market participants to make additional income by investing their assets that otherwise would have been blocked. As of September trades will be settled at 5.00 pm on T+4. Market participants’ delivery obligations will be calculated based on the settlement price determined during the intraday clearing session held on T+4.

Schedule for executing repo trades on RTS Standard
Repo trades are executed taking into account limitations regarding trades with settlement on the current trading day:

* - trades where the first leg is to be settled on the current trading day can only be executed between sections of registers opened for the same Clearing Member. If the first leg is to be settled on any other day, these limitations do not apply;
** - except for trades where the first leg is to be settled on the current trading day;
*** - if the trade is executed during the evening trading session, settlement on the current trading day means that settlement will take place on the next business day.

Specifications of codes

In the trading system repo instruments can be identified by the assigned long and short codes.

Table of interrelations between codes of RTS Standard instruments and underlying assets’ codes

Guidelines for updating the Plaza II trading terminal:

1. Download distributive FORTS_Setup_3.05.0085.0.msi at and save it to your local computer.

Please note, in case of upgrading the ODBC FORTS Terminal to a Plaza II terminal we recommend that you backup your user settings ini files (Futures.ini and Options.ini) in advance.

2. Launch the set up file and follow the instructions to install the terminal.
3. The installer will create shortcuts for the options and futures terminal on the desktop and in the Start menu. The terminal can be started by clicking any of these shortcuts.
4. After starting the FOLauncher service start the futures (or options) terminal by clicking the corresponding button.
5. In the settings menu choose the same ODBC data source that is used by the ODBC Terminal. Enter a new Plaza II login/password. The new Plaza II login is to be obtained by sending a written request to the Client Relations Department. For client support, please call us at +7 (495) 705-9031/32.
6. If necessary Futures.ini/Options.ini files in the folder of the new terminal are replaced with the ones saved earlier.

Please note that the new FORTS-RTS Standard Plaza II terminal updates automatically. For this option to function properly, the user’s computer must have access to the RTS ftp-server ftp.rts.ru/FORTSUpdates/Plaza2/.

Further information

• Presentation Repo trades on RTS Standard (ppt, 3 MB)
• Exchange fees for trades executed on RTS Standard

Contact details

If you need the assistance of our technical support team, please call us at +7 (495) 733-9507/, +7 (495) 500-3848, or e-mail us at help@rts.ru.