Sibiu Stock Exchange
Encyclopedia
The Sibiu Monetary Financial and Commodities Exchange (Bursa Monetar Financiarã şi de Mãrfuri Sibiu or BMFMS in Romanian
) is Romania's second largest financial market
. It was founded in December 1994 in the historical city of Sibiu
, Transylvania
by 11 initial shareholders, its main activity was trading commodities on the spot market. In July 1997, BMFMS has become Romania's first derivatives exchange through the implementation of futures contracts.
As opposed to The Bucharest Stock Exchange
, Romania's largest stock market
, BMFMS focuses almost exclusively on the exchange of derivative financial products
. The Sibiu Bourse is Romania's first and largest market of Futures
and Options
contracts to the day. Contracts are based on Romanian stock index, currencies, cross rates, interest rates, and (the newest addition - SIBEX Gold) gold price.
BMFMS operates its own safe clearing system, called the Romanian Clearing House (Casa Romana de Compensatie or CRC in Romanian), offering a secure market for hedgers
and speculators. It practices Margin trading
, with margins usually running in the range of 10-20%. Margin trading implies leverage
and higher levels of risk, with amplified profits and losses compared to conventional stock trading.
The Sibiu Stock Exchange runs two composite indices, called SIBEX9http://www.bmfms.ro/eng/smfce_indices/sibex9/sibex9.html and SIBEX18http://www.bmfms.ro/eng/smfce_stock_exchange_indices/sibex18/sibex18.html.
Back in 2005, BMFMS was evaluated by PricewaterhouseCoopers
to 3.4 million EUR, but it has been subject to continuous growth and expansion ever since. In comparison, in the same time period, PwC has evaluated the Bucharest Stock Exchange
at 16 million EUR. As of May 2006, The Sibiu Bourse had 74 shareholders of which 38 were financial investment companies. BMFMS is run by a Board of Directors presided by Mr. Teodor Ancuta, CEO and General Manager.
In May 2006, BMFMS discussed a merger with the larger Bucharest Stock Exchange
, located in the capital of Romania. After a lengthy period of negotiations between sides, in October 2006, shareholders of the Bucharest Stock Exchange
have rejected the proposal.
Failing to absorb the Sibiu Bourse, Bucharest Stock Exchange
(BVB) has announced (June 2007) that it plans to open its own derivatives market in the near future. BVB has long announced plans to start its own derivative products based on its main composite indices: BET
, BET-C, and BET-FI, (there is also a ROTX index, listed on the Vienna Stock Exchange). Eventually they might adopt currencies, stock index, and bonds as future underlying assets for their planned derivatives. Until then, The Sibiu Stock Exchange will still be seen as Romania's one and only powerful derivative marketplace.
Romanian language
Romanian Romanian Romanian (or Daco-Romanian; obsolete spellings Rumanian, Roumanian; self-designation: română, limba română ("the Romanian language") or românește (lit. "in Romanian") is a Romance language spoken by around 24 to 28 million people, primarily in Romania and Moldova...
) is Romania's second largest financial market
Financial market
In economics, a financial market is a mechanism that allows people and entities to buy and sell financial securities , commodities , and other fungible items of value at low transaction costs and at prices that reflect supply and demand.Both general markets and...
. It was founded in December 1994 in the historical city of Sibiu
Sibiu
Sibiu is a city in Transylvania, Romania with a population of 154,548. Located some 282 km north-west of Bucharest, the city straddles the Cibin River, a tributary of the river Olt...
, Transylvania
Transylvania
Transylvania is a historical region in the central part of Romania. Bounded on the east and south by the Carpathian mountain range, historical Transylvania extended in the west to the Apuseni Mountains; however, the term sometimes encompasses not only Transylvania proper, but also the historical...
by 11 initial shareholders, its main activity was trading commodities on the spot market. In July 1997, BMFMS has become Romania's first derivatives exchange through the implementation of futures contracts.
As opposed to The Bucharest Stock Exchange
Bucharest Stock Exchange
The Bucharest Stock Exchange is a stock exchange in Bucharest, capital of Romania. On December 1, 2005, Bucharest's electronic over-the-counter stock market, Rasdaq, was merged with the Bucharest Stock Exchange....
, Romania's largest stock market
Stock market
A stock market or equity market is a public entity for the trading of company stock and derivatives at an agreed price; these are securities listed on a stock exchange as well as those only traded privately.The size of the world stock market was estimated at about $36.6 trillion...
, BMFMS focuses almost exclusively on the exchange of derivative financial products
Derivative (finance)
A derivative instrument is a contract between two parties that specifies conditions—in particular, dates and the resulting values of the underlying variables—under which payments, or payoffs, are to be made between the parties.Under U.S...
. The Sibiu Bourse is Romania's first and largest market of Futures
Futures contract
In finance, a futures contract is a standardized contract between two parties to exchange a specified asset of standardized quantity and quality for a price agreed today with delivery occurring at a specified future date, the delivery date. The contracts are traded on a futures exchange...
and Options
Option (finance)
In finance, an option is a derivative financial instrument that specifies a contract between two parties for a future transaction on an asset at a reference price. The buyer of the option gains the right, but not the obligation, to engage in that transaction, while the seller incurs the...
contracts to the day. Contracts are based on Romanian stock index, currencies, cross rates, interest rates, and (the newest addition - SIBEX Gold) gold price.
BMFMS operates its own safe clearing system, called the Romanian Clearing House (Casa Romana de Compensatie or CRC in Romanian), offering a secure market for hedgers
Hedge (finance)
A hedge is an investment position intended to offset potential losses that may be incurred by a companion investment.A hedge can be constructed from many types of financial instruments, including stocks, exchange-traded funds, insurance, forward contracts, swaps, options, many types of...
and speculators. It practices Margin trading
Margin (finance)
In finance, a margin is collateral that the holder of a financial instrument has to deposit to cover some or all of the credit risk of their counterparty...
, with margins usually running in the range of 10-20%. Margin trading implies leverage
Leverage (finance)
In finance, leverage is a general term for any technique to multiply gains and losses. Common ways to attain leverage are borrowing money, buying fixed assets and using derivatives. Important examples are:* A public corporation may leverage its equity by borrowing money...
and higher levels of risk, with amplified profits and losses compared to conventional stock trading.
The Sibiu Stock Exchange runs two composite indices, called SIBEX9http://www.bmfms.ro/eng/smfce_indices/sibex9/sibex9.html and SIBEX18http://www.bmfms.ro/eng/smfce_stock_exchange_indices/sibex18/sibex18.html.
Back in 2005, BMFMS was evaluated by PricewaterhouseCoopers
PricewaterhouseCoopers
PricewaterhouseCoopers is a global professional services firm headquartered in London, United Kingdom. It is the world's largest professional services firm measured by revenues and one of the "Big Four" accountancy firms....
to 3.4 million EUR, but it has been subject to continuous growth and expansion ever since. In comparison, in the same time period, PwC has evaluated the Bucharest Stock Exchange
Bucharest Stock Exchange
The Bucharest Stock Exchange is a stock exchange in Bucharest, capital of Romania. On December 1, 2005, Bucharest's electronic over-the-counter stock market, Rasdaq, was merged with the Bucharest Stock Exchange....
at 16 million EUR. As of May 2006, The Sibiu Bourse had 74 shareholders of which 38 were financial investment companies. BMFMS is run by a Board of Directors presided by Mr. Teodor Ancuta, CEO and General Manager.
In May 2006, BMFMS discussed a merger with the larger Bucharest Stock Exchange
Bucharest Stock Exchange
The Bucharest Stock Exchange is a stock exchange in Bucharest, capital of Romania. On December 1, 2005, Bucharest's electronic over-the-counter stock market, Rasdaq, was merged with the Bucharest Stock Exchange....
, located in the capital of Romania. After a lengthy period of negotiations between sides, in October 2006, shareholders of the Bucharest Stock Exchange
Bucharest Stock Exchange
The Bucharest Stock Exchange is a stock exchange in Bucharest, capital of Romania. On December 1, 2005, Bucharest's electronic over-the-counter stock market, Rasdaq, was merged with the Bucharest Stock Exchange....
have rejected the proposal.
Failing to absorb the Sibiu Bourse, Bucharest Stock Exchange
Bucharest Stock Exchange
The Bucharest Stock Exchange is a stock exchange in Bucharest, capital of Romania. On December 1, 2005, Bucharest's electronic over-the-counter stock market, Rasdaq, was merged with the Bucharest Stock Exchange....
(BVB) has announced (June 2007) that it plans to open its own derivatives market in the near future. BVB has long announced plans to start its own derivative products based on its main composite indices: BET
Bet
Bet or BET may refer to:* A wager in gambling* Basic Economics Test * Bet , the second letter in many Semitic alphabets, including Aramaic, Hebrew, Phoenician and Syriac* Brunauer-Emmett-Teller isotherm. See BET_theory...
, BET-C, and BET-FI, (there is also a ROTX index, listed on the Vienna Stock Exchange). Eventually they might adopt currencies, stock index, and bonds as future underlying assets for their planned derivatives. Until then, The Sibiu Stock Exchange will still be seen as Romania's one and only powerful derivative marketplace.