JUNE 2013 - FEAS

FEDERATION OF EURO-ASIAN STOCK EXCHANGES ANNUAL REPORT JUNE 2013TURKISH DERIVATIVES EXCHANGE (TurkDEX)2012, a difficult year for Turkish capitalmarkets.Isinsu KestelliChairpersonThe year 2012 has been a year in which theworld had difficulties to stipulate growth and feltthe effects of the global crisis deeply. In Turkey,despite the goal of a 4% growth rate, a growthrate of below 3% was recorded at the end ofthe year. On the other hand although the EU,Turkey’s main trading partner, is still strugglingdue to the Euro Crisis, Turkey has been ableto keep the inflation and unemployment rate atone digit numbers, reducing the current deficitand public borrowing rate.2012 has been also a difficult year for theTurkish capital markets. As a result the tradingvolume of TurkDEX decreased for the firsttime of its history. Compared to 2011, in 2012the total trading volume decreased by 8.1%to 403.9 billion TRY. Among several issuesaffecting the trading volume negatively, we canspecifically point out that the overall global riskappetite decreased and that the demand forindex derivatives contracts at Turkdex reachedits saturation point. On the other hand thenumber of members increased to 101 andthe number of accounts increased to over80.000 in 2012. Despite the decrease in tradingvolume, Turkdex remained as one of the top30 derivatives exchanges according to FIA’sranking.HISTORY AND DEVELOPMENTThe Turkish Derivatives Exchange (TurkDEX)was formed as a self-governing joint stockcorporation in 2002 through a resolution of theCabinet based on the approval of the CapitalMarkets Board (CMB) of Turkey. The tradingstarted on February 4th, 2005 right after theauthorization of the CMB to operate as the firstderivatives exchange in Turkey. The Exchangecurrently operates for a core product baseof financial, equity and commodity futurescontracts using an electronic trading platform.The Board of Directors is composed of onerepresentative from the Istanbul Stock Exchange(ISE), two representatives from the Union ofChambers and Commodity Exchanges of Turkey,two representatives from the Association ofCapital Market Intermediary Institutions of Turkey,three representatives from bank and brokeragehouse shareholders, one representative fromTurkDEX (CEO) and one representative from theIzmir Commodity Exchange.TurkDEX offers an efficient, liquid andinvestor friendly electronic trading platformfor the trading of futures contracts on interestrates, stock indices, foreign currencies andcommodities. One of the main objectives ofTurkDEX is to develop and provide financialinstruments that help individuals and institutionsto effectively manage their risks against pricefluctuations. Currently, 15 different derivativeinstruments, namely; currency futures contracts(TRY/US$, TRY/EUR and EUR/US$), interestrate futures contracts (Benchmark Treasuries),equity index futures contracts (TurkDEX-ISE30 Stock Index, TurkDEX-ISE 100 Stock Indexand TurkDEX-ISE 30-100 Index Spread), cottonfutures contracts, wheat futures contracts, goldfutures contracts (TRY/gram and US$/ounce),base load electricity futures contracts and livecattle futures contracts are traded on TurkDEX’sentirely electronic trading platform. With itselectronic trading platform, TurkDEX providesaccess to traders wherever they are located,subject to applicable local laws and regulations.PAGE 87