Deutsche Boerse AG attracted Russia's Troika Dialog to Eurex

Updated August 25, 2008

   The German exchange operator Deutsche Boerse AG attracted the largest Russian player - Troika Dialog - to Eurex, one of the world’s largest derivatives stock exchanges. The investment company is the third Russian broker that became a member of the German stock exchange. However, despite the results of the brokers’ attraction, Deutsche Boerse AG didn’t manage yet to reach its core aim - the Russian issuers’ presence.

   The information about Deutsche Boerse AG’s intention to attract TD Investments Limited incorporated on Cyprus (belongs to Troika Dialog Group of Companies) to Eurex is posted on the official web site of the stock exchange. Troika Dialog is the third Russian player that became the member of the German exchange. Since 2004 Aton Inverstment Company is operating at the stock exchange. In December, 2007 Finam Investment Holding became the member of such German floors as Xetra and Eurex that belong to Deutsche Boerse Holding.

   "The membership on the German exchange became interesting for us, after MSCI options and futures appeared among the instruments of this stock exchange at June-end", the director of Troika Dialog management for derivative instruments Georgy Mirel explained. 90% in the structure of Troika Dialog’s turnovers on derivative instruments falls to the futures on the RTS index. The rest 10% - derivates on the MSCI Russia index, on the RIOB index of the London Stock Exchange, on the RDX index of the Vienna Stock Exchange. All these indices comprise the securities of the Russian issuers.

   Eurex is the largest exchange floor for trading derivative financial instruments. 50% of the trading floor belongs to Deutsche Boerse AG - the integrated exchange holding that provides services on the organization of electronic trade, clearing, calculations of deals, depositary and information services. The stock exchange’s capitalization is $23,5 billion, and therefore it occupies the 2nd place in the world rating after the NYSE Euronext

   The derivative instruments on the MSCI Russia are the most attractive for the investors, as experts mark. "The key factor of demand growth for the derivatives is a degree of the core asset development", Derivative Expert chief executive Illya Efimchuk explains. "All investors know how the MSCI Russia index is calculated, therefore the derivatives on this instrument can compete with the futures on the RTS index". The majority of the western funds compare the profitability of their investments with the dynamics of the MSCI Russia index, as the expert marks. "The derivatives on this index are the perfect instrument of risks’ hedging for the majority of our foreign clients", Georgy Mirel considers.

   According to the data of some sources, by year-end Otkritie Managing Company and Uralsib Managing Company can become the members as well. In addition, at the end of May Renaissance Capital became Deutsche Boerse’s listing partner, as reported in the Russian company.

   However, despite the results of new members’ attraction, Deutsche Boerse hasn’t managed yet to attract the depositary receipts of the Russian issuers. In the meantime, it was the core aim of the German exchange operator within the opening of the Russian representative office. Thereby, the German operator expected to weaken the positions of the London Stock Exchange (LSE), where, according to the data of Thomson Financial for 2007, the volume of the Russian companies’ placements reached $20,1 billion. It is the 4th position in the rating of the countries that have provided the highest IPO volume. Mechel Company was the first issuer that planned placing its securities at the German floor. However, after prime minister Vladimir Putin had criticized the metallurgical company, its quotations fell by almost 50%, and IPO was put off. In the opinion of director of Metropol Investment Company department for investment and banking services Ekaterina Akhanova, currently, the negative market situation doesn’t promote the entry of the Russian companies to IPO. "The Russian issuers will hold their placements at the German floor after the stock market’s dynamics starts recovering", as Ekatrina Akhanova says.