Our Services
Equity Trading
About 80% of the volume of trade in Russian stocks is conducted through the Russian Trading System (RTS). The RTS is an over the counter system which is based on the US NASDAQ system and in September 1996 had 172 members. All trading is carried out electronically via PORTAL on which only about half of the total number of PAUFOR members actively trade. Approximately 80 Russian companies are listed on the RTS however, given the illiquidity of the shares of the majority, less than 20 can be considered as true "Blue chips". We have been actively
trading on the RTS since January 1996 (when OPM-Bank gained membership of PAUFOR). We are a market maker in Russia's most actively traded stock (Mosenergo) as well as a number of other blue chips.
It is no secret that Russian stocks are undervalued even in comparison to stocks of other so-called "emerging markets" (a label which does not well fit the situation in Russia). There are a number of reasons why the market has been, and remains, so undervalued. The most notable of which are the unclear property ownership laws, constantly shifting (and frequently retroactive) tax legislation, the lack of an effective share settlement structure and numerous barriers to cross border flows of foreign capital. All of these areas are currently being addressed at a federal level with the result that the investment climate for foreigners is improving daily.
Russia's Federal Securities Commission predicts that turnover in the share market of USD 5 billion in 1995 could rise to USD 30 - 80 billion by the century's end. Market capitalization could rise from USD 20 billion to between USD 80 and 130 billion. Furthermore, the entry of Russia into an International Finance Corporation index of emerging markets and a rating for Russian debt could all help stock prices, which may rise a further 20 - 50% by year end of 1996. We perceive these to be good reasons for the foreign investor to consider the Russian market.
Our bank offers professional, western-style brokerage services to Russian and international investors (at a private and institutional level) who are looking for a convenient and secure way to include Russian securities in their portfolios.We offer two main approaches:
Portfolio Management Option - offers you the advantage of having your investment portfolio handled by your own trader. You give our bank the authority to manage assets on your behalf. We work together with you to define an investment strategy that reflects your investment goals, your time horizon, your willingness to take risks and also your tax position. We invest your assets within these guidelines, continuously adapt your portfolio to changing market conditions and keep you regularly informed.
Investment Advice Option - whereby you make your own investment decisions. Our role is to provide you with timely and useful advice and information in order to facilitate your decision making process, as well as to execute your instructions promptly and accurately.
OPM-Bank offers:
- general broker - dealer operations
- purchase of stocks from Russia's remoter regions; including from individuals
- on-line access to the Russian Trading System (PORTAL) terminals in the bank's premises
- creating and managing portfolios
- portfolio diversification
- nominee services
- minimization of capital gains and dividends tax liabilities in Russia and abroad
- clearing and settlement of shares transactions.
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