Sibex is getting ready for revolutionary changes

• Yesterday, the Board of Directors was set to vote on extending the trading schedule until 23:15 hrs, as well as on the cooperation with Societe Generale and Nomura

The extension of the trading program on the derivatives market of Sibiu until 23:15, when the options and derivatives close in the United States, was going to be put up for a vote in the meeting of the Board of Directors of Sibex yesterday.

The extension of the trading program was repeatedly requested by domestic speculators, eager to seize any potential price differences between the Dow Jones Industrial Average (DJIA) in Sibiu and those in New York, and was also included in the program which helped Cristian Sima get elected as president of the Sibiu Exchange.

Florin Cătinaş, an analyst at "WBS Romania", the brokerage firm which took on the role of market maker on the DEDJIA contracts of Sibiu, claims that the extension of the trading schedule would allow domestic investors to use more trading strategies. He said: "The extension of the derivatives trading schedule in Sibex until 23:15 would allow investors to benefit from the volatility of American exchanges. The more alternatives made available to investors, the more trading strategies they will be able to implement. The extension of the trading program was not someone"s whim; several investors requested this, since they want to be able to trade on the market of Sibiu, for the entire time that the DJIA index is being traded and calculated in the United States.

Also, trading in the EURUSD pair, gold and oil would benefit from an extended schedule, which would be close to that of the foreign platforms.

There are multiple benefits to this, such as lower costs for investors, since in general, trading on foreign platforms involves commissions for the currency transfers between Romanian and foreign banks. Also, Romanian customers will be allowed to trade on margin in lei, at Romanian institutions, through Romanian brokerages. This way, Sibex could become a serious competitor for the foreign trading platforms (including Forex) which are running 24 hours a day".

The extension of the trading schedule caused a disagreement between Cristian Sima, the main proponent of the idea, and Teodor Ancuţa, the former president of Sibex.

He stressed that the implementation of such a measure would involve additional costs, for the Exchange, which would be forced to hire more people or to pay more the ones it already employs, as well as for brokerage firms. Market sources claim that Ancuţa was afraid that brokerages of Sibiu would migrate to the Bucharest Stock Exchange, since many of them would not be able to bear the increase in trading costs, as a result of the extension of the trading schedule.

Similarly, the Bucharest Stock Exchange recently decided to extend the trading schedule by 15 minutes, until 16:45, claiming that the evolution of the BSE has become increasingly sensitive to foreign factors and to the North-American capital market and that in this way, BSE investors will be able to react to the opening of the American Exchanges and to use the information coming in from those markets.

The directors of were also expected to decide yesterday on hiring Cristian Sima as International Relationships Advisor, starting with May 23rd, as well as on initiating discussions with Societe Generale and Nomura for a cooperation concerning the trading of ETFs (Exchange-Traded Funds).

The agenda of yesterday"s meeting of the Board of Directors also included the proposals for the approval, on principle, of the plan to allow any customer of a brokerage firm to become a market-maker, as long as they could prove that is has opened on its name a collateral deposit of a minimum of one million lei and the modification of the OPDEDJIA_RON options in order to begin their trading.

Also in yesterday"s meeting of the Board, the directors of Sibex were set to decide on the proposal to send to the Romanian Clearing House (CRC) and to the Sibex Depository the request to summon Extraordinary General Shareholder Meetings. Their agendas would include the revocation of the current Board of Directors and the election of new members.