Investors expect the Euro to reach 4.51 lei, at the end of the year

• Over a thousand open positions on the EUR/RON contract for December, on the Bucharest Stock Exchange

Investors on the Bucharest Stock Exchange yesterday were expecting the EUR/RON exchange rate to reach 4.519 lei for one Euro at the end of the year, whereas on the Sibiu Exchange, the Euro/Ron exchange rate was seen at 4.473 lei, according to the futures contracts concluded.

The volatility of the EUR/RON exchange rate has determined some of the investors to try and hedge their risk using futures transactions.

Yesterday alone, there were over 1,000 positions open on the EUR/RON for December, were opened on the BSE, double compared to the number of positions opened on Friday, whereas on the Sibiu exchange around 350 positions were opened.

The last two trading sessions saw increased liquidity for futures contracts on the BSE, whereas those instruments were usually ignored by domestic investors. On Friday, the turnover for exchange rate futures reached nearly 1.5 million Euros, whereas yesterday"s turnover reached 2.53 million Euros. The previous record was recorded last autumn, when the turnover for futures contracts on the exchange rate reached 1.79 million Euros, in one session.

"In times of high volatility, we can see two types of players that are more active than the rest: financial institutions (pension funds, insurance companies) and speculators", said for BURSA, a broker that wanted to remain anonymous, adding: "High volatility makes players in the first category more willing to conclude futures transactions to protect themselves, whereas speculators see such moments as opportunities to secure additional earnings.

"Indeed, turnover on the BSE has increased, but it is nothing unusual, given the fact that these instruments have, however, low liquidity in Bucharest. It is worth mentioning that the real amount that investors are betting in these contracts is just a percentage of the total, because they are trading on margin".

27 transactions with 2426 futures contracts on the exchange rate were concluded yesterday in Bucharest, with December contracts being the most liquid, followed by September contracts. In Sibiu, around 160 transactions were made on the two maturities, with over 500 contracts concluded.

On the Sibiu Exchange, the euro/ron for March 2011 was quoted yesterday at 4.49 lei, whereas in Bucharest, the price was 4.36 de lei, for March (the date of the last trade).