Equity Derivatives

Futures on single stocks of Russian companies

Futures based on single stocks issued by Russian companies have been successfully traded at the FORTS market for many years. The list of shares for futures’ contracts has been constantly developing and growing throughout these years. The issuers of the stocks of the future contracts are the leading companies in the most developed segments of the Russian market: oil production, energy, communication and metallurgy.

Broadening the potentialities of equity portfolio managers by means of single stock futures:

  • Reducing the risk of the equity portfolio
  • The possibility of short sales
  • Using “the leverage effect” which is about 1,5:1,7 on average
  • Reducing transaction costs when working with shares
  • Lower commission charges (e.g., the lack of depositary charges)
  • Free “leverage” (the participants are charged only with the opening and closing of a position, whereas position trading is free)
  • Creating short-term “synthetic” bonds
  • The possibility of strategy construction for futures and options on futures.
KID on Equities

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Currency Derivatives

Currency (FX) futures: futures whose underlying instrument is a currency exchange rate (currency pair). FX futures are derivatives contracts that help investors manage the risk associated with currency fluctuations. Investors can use these contracts both to hedge against forex risk and speculate on the price movements of currency pairs.

KID on FX Futures

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Transactions in futures involve the obligation to make, or to take, delivery of the underlying asset of the contract at a future date, or in some cases to settle the position with cash. They carry a high degree of risk. The gearing or leverage often obtainable in futures trading means that a small deposit or down payment can lead to large losses as well as gains. It also means that a relatively small movement can lead to a proportionately much larger movement in the value of your investment, and this can work against you as well as for you. Futures transactions have a contingent liability, and you should be aware of the implications of this, in particular the margin requirements.