Moscow Exchange facts for kids

Kids Encyclopedia Facts

Moscow Exchange
Quick facts for kids

Type	Stock exchange, futures exchange, FX exchange
Location	Moscow, Russia
Founded	19 December 2011; 13 years ago (2011-12-19)
Owner	Public company
Key people	Yury Denisov (CEO)
Currency	Russian ruble
No. of listings	219
MarketCap	US$ $773 billion
Indexes	MOEX Russia Index, RTS Index

The Moscow Exchange (often called MOEX) is the biggest exchange in Russia. An exchange is like a big marketplace where people buy and sell different financial things. MOEX helps people trade stocks, bonds, and even different currencies. It also deals with things like gold and silver.

MOEX also runs important services that help these trades happen smoothly. It has a central place to keep track of who owns what, called the National Settlement Depository (NSD). It also has a service that makes sure trades are completed correctly, called the National Clearing Centre. The Moscow Exchange was created in 2011 when two other big exchanges joined together. By the end of 2023, a huge amount of money, about $14 trillion, was traded on MOEX platforms.

History of the Moscow Exchange
Who Manages the Moscow Exchange?
Who Owns Shares in the Moscow Exchange?
What Can You Trade on MOEX?
Services After Trading: NSD and NCC
See also

History of the Moscow Exchange

The Moscow Exchange was formed on December 19, 2011. It was created by combining two major exchanges in Moscow: the Moscow Interbank Currency Exchange (MICEX) and the Russian Trading System (RTS). This is why it was first called "Moscow Exchange MICEX-RTS." Both of these older exchanges had been around since the 1990s. They were the main trading places in Russia for about 20 years.

The merger helped Russia's goal to make Moscow a big international financial center. In 2013, the Moscow Exchange offered its shares to the public for the first time. This is called an initial public offering (IPO). They raised about $500 million, which was a lot of money at the time for an offering only in Moscow. Many large investors from around the world wanted to buy shares.

In 2014, the Central Bank of Russia, which owned a large part of the exchange, sold some of its shares. A Russian law required the Central Bank to sell all its shares by 2016. In 2018, MOEX started allowing people to trade futures contracts for gold. This means you could agree to buy or sell gold at a set price on a future date.

In February 2022, after some major global events began, the Moscow Exchange stopped trading for a while. Soon after, foreign clients were not allowed to sell their investments. In March 2022, the exchange was also suspended from the World Federation of Exchanges. This is a group of exchanges from all over the world.

Trading slowly started again in March 2022, first with government bonds. Then, some Russian stocks were allowed to be traded again, but only by people living in Russia. Foreign investors had many restrictions. Also, a practice called "short selling" was banned. This is when you bet that a stock's price will go down. By August 2022, the exchange was still not fully back to normal operations. The exchange was also affected by international actions against Russia. For example, the United Kingdom removed its special status for the exchange.

Who Manages the Moscow Exchange?

The Moscow Exchange has an Executive Board that helps run the company. This board includes important leaders who make decisions about how the exchange operates every day.

Here are some of the key people on the Executive Board:

Yury Denisov: He has been the CEO (Chief Executive Officer) since 2019. The CEO is like the main boss of the company.
Andrey Selyuk: He is the chief financial officer. He manages the money side of the exchange.
Andrey Burilov: He is the chief information officer. He is in charge of all the technology and computer systems.
Igor Marich: He is the Managing Director of Sales & Business Development. He helps the exchange grow and find new customers.
Dmitry Shcheglov: He is the chief operating officer. He makes sure all the daily operations run smoothly.

Who Owns Shares in the Moscow Exchange?

The Moscow Exchange's shares are traded publicly, meaning anyone can buy them. Its shares are known by the ticker symbol MOEX. As of December 2021, about 63% of the shares were available for anyone to buy.

Some large organizations also own big parts of the Moscow Exchange:

The Central Bank of Russia owned about 11.75% of the shares.
Sberbank, a large Russian bank, owned 9.9%.
Vnesheconombank, another Russian bank, owned 8.4%.
The European Bank for Reconstruction and Development owned 6.1%.
A big investment company from the US, Capital Research and Management Company, also owned shares.

Overall, investors from the US owned about 36.8% of MOEX shares, and investors from the UK owned 10.1%. Also, many individual Russian investors, about 360,000 of them, owned shares in MOEX.

What Can You Trade on MOEX?

The Moscow Exchange has different markets for trading various financial products.

Stocks and Bonds Market

This market is a very important place for Russian companies to get money to grow. It's also where investors, both from Russia and other countries, can buy and sell stocks and bonds. Stocks are small pieces of ownership in a company. Bonds are like loans you give to a company or government, and they pay you back with interest.

This market is the main place to trade shares of big Russian companies. These include well-known names like Gazprom, Sberbank, Rosneft, and Lukoil. In 2013–2014, 16 companies raised about 200 billion rubles by selling stocks through MOEX. Also, over 400 bond issues were sold, raising more than 3.4 trillion rubles.

More and more individual people in Russia are also investing. By January 2022, about 17 million people had trading accounts on the Moscow Exchange. This was about 11% of Russia's population.

Foreign Currency and Money Market

This market is where different currencies are traded, like the Russian ruble (RUB) against the US dollar (USD) or the Euro (EUR). The Central Bank of Russia uses this market to manage the country's money supply.

For banks and companies, MOEX offers ways to manage their money and protect themselves from changes in currency values. It's the main place to find the price of the Russian ruble. All currency trades on this market are checked and completed by the National Clearing Centre. In September 2014, about $22.4 billion worth of currency was traded each day. While the ruble against the dollar and euro were the most popular trades, MOEX also encouraged trading in other currencies like the Chinese yuan (CNY) and the British pound (GBP).

Derivatives Market

The Derivatives Market is where people trade special financial contracts called "derivatives." These include futures contracts and options contracts. These contracts get their value from something else, like a stock price, a currency, or even the price of gold.

As of 2014, the Moscow Exchange was one of the top 10 largest places in the world for trading derivatives. You could trade futures and options on things like stock indexes, shares of Russian and foreign companies, currency pairs, precious metals, and even energy products. For example, futures contracts based on the RTS Index were among the most traded in the world.

Commodities Markets

MOEX also has markets for trading "commodities," which are raw materials like metals or grains.

Trading Precious Metals

In 2013, the Moscow Exchange started allowing people to buy and sell gold and silver right away (this is called "spot trading"). They also planned to start trading platinum and palladium.

Trading Grain

The National Mercantile Exchange, which is part of MOEX, is Russia's main place for trading grain. This includes buying and selling grain right away, and also trading futures contracts for agricultural products. Since 2002, the Russian government has used this platform to manage the grain market.

Services After Trading: NSD and NCC

The Moscow Exchange has two important companies that help complete trades and keep records.

The National Settlement Depository (NSD) is a company owned by MOEX. In 2012, it became Russia's official Central Securities Depository. This means it's the main place where records of who owns stocks and bonds are kept. Because of NSD, big international companies like Euroclear Bank and Clearstream Banking SA could open accounts in Russia. This made it easier for international investors to buy Russian bonds and stocks.

However, after the major global events in 2022, NSD faced many challenges. On March 1, 2022, NSD blocked and froze all investments held in Euroclear's account. It also stopped payments on Russian investments to people and companies outside Russia. In turn, NSD's own accounts at Euroclear and Clearstream were blocked. The European Central Securities Depositories Association also suspended NSD from its membership. The European Union added NSD to its list of international actions, which meant NSD's accounts in euros were blocked. This made it impossible to handle bonds issued by Russia and Russian companies that were in foreign currencies.

Another company owned by MOEX is the National Clearing Centre (NCC). NCC is Russia's largest "clearing center." It acts as the Central Counterparty (CCP) for all trades on the Moscow Exchange. This means it stands between buyers and sellers to make sure trades are completed, even if one side can't fulfill their part. In response to the 2022 events, the European Association of CCP Clearing Houses (EACH) suspended NCC from its membership.