Launch and Trade Derivatives and Structured Financial Instruments on Our Exchange

The regulatory regime of the Kyrgyz Republic flexibly allows the creation and trading of financial instruments which are structured as contracts and are therefore not considered ‘emission securities’ (i.e. series-issued securities that normally require a Prospectus to be approved by the regulator). This ensures that the launching time for new structured and derivative instruments can be as short as several days. The Exchange, as required by law, will notify the regulator of the form of the new contract launched for trading, after it is approved by the Exchange.

A variety of legal formats of derivative instruments are recognized by Kyrgyz law: futures, forwards, options etc. Their underlying asset may be a financial instrument (such as a security or a basket of securities), an index or a commodity / commodity-based obligation. Since by law our Exchange combines the functions of a stock exchange and a commodity exchange, we may list for trading both financial and commodity-based contracts.

Functionally, our Exchange is both an organized trading venue and a depository-clearing organization (we hold both licenses). This allows a fast settlement of trades, shortening the post-trade phase on some instruments to hours, not days.

Normally you have to access the Exchange through an accredited trading member, being a Kyrgyz Republic-licensed securities broker-dealer or asset manager. The derivative section, though, allows the accreditation of traders not having a securities license. This includes both Kyrgyz and foreign companies.