The exchanges of Bucharest and Sibiu are competing on derivatives based on the shares of the Proprietatea Fund

Starting today, derivatives having the shares of the Proprietatea Fund as their underlying asset can be traded on the Bucharest Stock Exchange, and on the Sibiu Exchange, just two days after the Fund was listed on the BSE, generating a turnover of a few dozens millions of Euros.

The management of the two institutions entered a race against the clock, each of them fighting to be the first to launch the derivatives for the Proprietatea Fund. At first, the Sibiu Exchange seemed to have gotten a leg up over the Bucharest Exchange, after having received the license from the Romanian National Securities Commission to launch derivatives for the stock of the Proprietatea Fund. Teodor Ancuţa, the chairman of Sibex, had expressed his hope that derivatives based on the Proprietatea Fund would start trading on the Sibiu exchange starting with the month of February.

Yesterday, the Bucharest Stock Exchange announced that it would launch the derivatives for the Proprietatea Fund today, whereas around noon it was still running trading tests on the ARENA platform and was awaiting the license of the CMVM, according to Valentin Ionescu, the managing director of the BSE. Besides, Stere Farmache, the chairman of the BSE, said on Tuesday, on the occasion of the listing of the Proprietatea Fund, that the BSE would launch derivatives based on the Proprietatea Fund on February 1st.

Yesterday"s announcement by the BSE seems to have troubled the plans of the Sibiu Exchange, which later announced that it would also launch the derivatives of the for the Proprietatea Fund today.

Teodor Ancuţa, the chairman-managing director of Sibex, said: "Through this new product, we want to help investors who want to speculate on the evolution of the Proprietatea Fund using smaller amounts than those needed on the spot market, as well as for those who want to protect their portfolio of shares against potential price corrections, and the DEFRP derivative is the ideal tool for that purpose".

Valentin Ionescu, the managing director of the BSE, said: "I am confident that these derivatives will be actively used by investors in creating more complex strategies, by using the spot and futures markets together".

The derivatives based on the shares of the Proprietatea Fund, traded on the BSE, will have two maturities, March 2011 and June 2011, whereas the derivatives of Sibiu will have quarterly maturities, with the starting months being March, June, September and December.

A contract is the equivalent of a thousand shares of the Proprietatea Fund. The fee charged by the BSE will be 0.05 lei/contract, but the officials of the BSE have announced that the BSE would charge no fees for derivatives contracts which have the stock of the Proprietatea Fund as their underlying asset until February 28th, 2010. The Bucharest Clearing House charges a fee of 0.1 lei/contract.