Trading modes
Trading modes

In accordance with the Rules of Government Securities Trading, trade participants are empowered to carry out two main types of transactions: "before redemption" (standard purchase and sale transactions settled on the day of the transaction) and REPO transactions "all against all" (purchase and sale transactions with the repurchase obligation). Only banks are authorized to carry out REPO transactions in government securities. Trades in this segment are carried out on one hundred percent pre-deposit principle. In addition, there is a primary government securities market which is governed by the special rules of the Ministry of Finance of the Republic of Belarus. The Ministry of Finance of the Republic of Belarus carries out primary auctions and additional placement of government securities in the form of closed price auctions on the principle of full or partial pre-deposit. The National Bank of the Republic of Belarus also carries out own auctions at the BCSE within the secondary government securities market under conditions of direct and/or reverse repurchase agreements, or under ordinary conditions.

 

 

Call auction

Integration trading method when limit orders are collected over a (fixed) period. At the end of this time, the orders are processed in the auction at a common price that enables the largest number of orders to be executed.

·             limit order kept in quotations (an order is kept in the trading system until its full fulfillment);

Participant offers to buy securities at not more, or to sell at not less, than a specific price. Limit orders are satisfied if its price is matched with the common price of the auction. If the buy price is not equal to the sell price, buy orders with a higher price and sell orders at a lower price are executed first. If there are several orders at the same price, the one that was submitted earlier will be executed first.

At the end of call auction, all unsatisfied orders with S-T+0 settlements can participate in a continuous double auction.

S-T+0 - are carried out in the settlement and clearing system on the day of the transaction 

S-T+n - settlements are carried out in the settlement and clearing system within the established by parties period "n"

Forward transactions (Quote-Driven

Market)

transaction mode on the base of direct orders sent to a particular party or group of participants, implying the possibility of conducting transactions at a fixed by contractors execution term

·      orders to conduct S-T+n transactions;

·      orders to conduct NS transaction.

Orders are executed and transactions are concluded in the trading system when two counterbids are matched. If two or more opposing orders appear with the same entries, the one that was submitted earlier will be executed first. Orders included in the group are executed simultaneously if there is a group of counterbids.

S-T+n  - settlements are carried out in the settlement and clearing system within the established by parties period "n"

NS - settlements are carried out directly between parties

Simple Auction

Iterative trading method implying only one buyer - simple auction to buy, or only one seller - simple auction to sell 

ü limit orders (an order to buy certain financial instruments at not more, or sell at not less, than a specific price);

ü market orders (An order to buy or sell a stated amount (number) of securities indicated in the order).

 

Limit orders are executed at a stated in these orders prices, market orders are executed at the average weighted price calculated upon executed limited orders. The average weighted price is calculated by dividing the amount of all satisfied limited orders by total number of securities in these orders. If no limited order submitted to the trading system can be satisfied fully or partially during a standard simple auction, no matter whether the starting price was announced or not, the simple auction is announced as failed. The simple auction is announced as failed if the buy or sell volume is less than stated by the auction parameters.

S-T+0 - are carried out in the settlement and clearing system on the day of the transaction 

S-T+n - settlements are carried out in the settlement and clearing system within the established by parties period "n"

S-REPO - first REPO transaction part settlements are carried out in the settlement and clearing system on the day of its conclusion, second REPO transaction part settlements are carried out within the period established during its conclusion

NS - settlements are carried out directly between parties

REPO (fix pricing)

Mechanism of REPO transactions conclusion when the price of a financial instrument for the first part of the transaction is fixed before operations (at the average weighted price determined upon results of a double or a call auction, the current value of the securities or other defined values ??or functions). In this case the item of these transactions may be a group of securities, the REPO rate is the subject to trade.

Conclusion of REPO transaction upon submitted orders is possible only when the yield rate, REPO term and the order volume are matched.

The trading system compares the value of initial position on cash (securities) of the participant who submitted an order with the amount needed to meet this request (with the volume of the order). If the value of the initial position is less than the amount (volume) of the bid, the order processing is terminated. If the value of the initial position is greater than or equal to the amount (volume) of the bid, the order is processed further.

The trading system verifies whether there are unsatisfied orders in the queue for REPO sale (purchase), the announced yield of which is equal to the one announced in the processing order. If such orders appear, they are executed according to the yield level in the queue.

If in the queue there is no REPO sale order providing the possibility of concluding the transaction, REPO purchase (sale) order is placed in the queue of unsatisfied REPO purchase (sale) orders.

Unsatisfied REPO sale (purchase) orders in the queue are arranged in order of yield decreasing (increasing), and in case of equal yield - in order of time of their submission. The REPO sale (purchase) order submitted earlier will be executed first. If an order in the queue is satisfied, it will be removed from the queue of unsatisfied REPO sale (purchase) orders.

S-REPO - first REPO transaction part settlements are carried out in the settlement and clearing system on the day of its conclusion, second REPO transaction part settlements are carried out within the period established during its conclusion

 

REPO (free pricing)

Mechanism of REPO transactions conclusion when the price of a financial instrument for the first part of the transaction as well as REPO rate are subject to trade. It is the base to determine the price of redemption (repurchase), the object of these transactions can be a specific security only

Participant offers to buy (sell) securities on T+0 basis (T- a day of submitting an order) in the amount and at the price specified in the order (the first REPO part), and repurchase of the same number of securities (the second REPO part) on T + n basis (T - the date of submitting an order, n - number of calendar days specified in the order under " repurchase agreements term"). Orders are executed and transactions are concluded in the trading system when two counterbids are matched. If there are two or more counterbids with the same entries, the one that was submitted earlier will be executed first. Orders included in the group are executed simultaneously if there is a group of counterbids.

S-REPO - first REPO transaction part settlements are carried out in the settlement and clearing system on the day of its conclusion, second REPO transaction part settlements are carried out within the period established during its conclusion