Catalog: net cash position. Stock market technologies: Brokerage trading system Monetary reform

When making a monetary transaction, the bank acquires 1 hard currency and sells another. In a transaction with immediate delivery of hard currency, this means investing his resources in the hard currency that he sells. Since the bank takes a position for a term, then, when buying a claim in a certain currency, it perceives a promise in another currency. As a result of these operations, 2 different currencies appear in the assets and liabilities of the bank, in the form of currency or in the form of obligations, the rate of which changes independently among themselves, leading to the fact that at a certain moment it can exceed the liability, forming, or vice versa.

The correspondence of the claims and obligations of the bank, including its off-balance sheet transactions, in foreign currency characterizes its monetary transaction. If they are equal for a certain hard currency, the monetary position is considered closed, and if they do not match, it is considered open. An open monetary position can be short, since the promises for the sold currency exceed the assets and claims in it, and long, since the assets and claims for the purchased currency exceed the liabilities and obligations. When long, the trader, in anticipation of a rise in the exchange rate, buys the base currency. Among other things, it will be considered that there is an open long position in a certain foreign hard currency, since at equilibrium there is an asset denominated in this foreign currency, for example, acquired Eurobonds.

In the same way, the bank will have a long transaction on the American dollar, since in the absence of attracted funds in this currency, including contributions from the population, balances in the accounts of legal entities, the bank has issued loans denominated in United States dollars. In a short position, in anticipation of a depreciation, the base currency is sold. Among other things, it will be considered that there is a position to sell in this hard currency, since there is a liability, for example, loan promises, denominated in dollars. For the example with a bank, the position will become short when, in the absence of issued loans, balances on correspondent accounts denominated in hard currency, the bank has attracted funds denominated in it, for example, deposits. As a result of a reverse sale for a long position or a reverse buyout for a short position, or if the assets in a certain hard currency become equal to the liabilities in the same hard currency, the cash position is said to be closed.

A short cash position can be offset by a long position if the size, transaction deadline and free currency of these positions are similar. This principle is important because an open monetary position is associated with the risk of losses for the bank, when by the episode of a counter-transaction, in other words, the purchase of previously sold hard currency and the sale of earlier acquired hard currency, the rate of these hard currency changes in an unfavorable direction. As a result, the bank will either be able to acquire, through a counter-transaction, the smallest required amount of hard currency than it previously sold, or it will be obliged to pay for the same required amount a larger equivalent of the previously acquired hard currency. In two options, the bank incurs expenses of its funds associated with changes in the monetary exchange rate. is constantly present in the presence of open positions, both long and short.

Since an open cash position is created for certain hard currency, in the process of the bank’s constant operations on the foreign exchange market, cash positions constantly appear and disappear. A change in the amount of a cash position occurs, as noted earlier, through the configuration of the amounts of liabilities and assets in hard currency. Changes in assets and liabilities, moreover, occur through the performance of specific current monetary transactions and transactions related to the movement of money.

The occurrence of losses or the receipt of benefits will depend on the direction of the monetary exchange rate configuration and on whether the bank is in a net-long or net-short position in foreign hard currency. The net position is oriented by adding up all net positions taking into account the symbol, in contrast to the calculation of monetary risk, where the position symbol is not provided. If the bank has a long transaction in a currency, the revaluation will cause profits when the currency exchange rate rises, and losses when the currency exchange rate falls. And, on the contrary, a sell position will give rise to gains when the rate of foreign hard currency decreases, and to losses when the rate of foreign hard currency increases. Banks constantly monitor changes in the monetary position, set a limit for any partner bank, assessing the monetary risk and the likely outcome in the event of its immediate full coverage at available monetary rates. This task is complicated by the fact that the actual monetary transaction includes cash and urgent transactions, absolute at different times at different rates.

The result of the cash position is positive for the bank if it held a long transaction in hard currency, the rate of which increased. But this success can be fully realized only by closing all cash positions at current rates. This operation is called the realization of benefits and traditionally occurs during periods of intense trend in hard currency, stopping its movement, and from time to time temporarily changing its dynamics in the opposite direction.

The creation of currency positions throughout the day is justified by the conduct of arbitrage monetary transactions in time and can be eliminated by the simultaneous covering of any transaction with a counter-transaction. But big banks resort to counter-transactions exclusively during a global crisis. Maintaining long or sell positions in some currencies for several days or weeks is regarded as monetary transactions, since if short-term arbitrage positions can be considered the result of requests from the bank’s clientele, maintaining an open monetary position for a long time is a responsible action aimed at benefiting from changes in exchange rates.

Analysis of the bank’s currency position and ways to adjust it

The work of banks in money markets is associated with the management of assets and liabilities in foreign currencies, monetary risks that arise from the introduction of different currencies during banking operations. Currency risk- this is the risk of loss or shortfall in benefits in the state currency associated with a negative configuration of the monetary exchange rate. In addition, risk is the possibility of losses or additional costs during the execution of a monetary transaction, stimulated by a lack of analysis of this transaction with a monetary asset, miscalculation or unforeseen situations in general. Currency risk is considered a type of monetary risk, therefore, when assessing it, the same informants are used, in fact, when assessing the overall condition of the bank, on the one hand, and in general, an adequate assessment of the bank’s monetary position is not possible in the absence of a separate assessment of monetary risk.

The cash position appears on the date of decision of the transaction for the purchase or sale of foreign hard currency and other monetary assets, as well as the date of crediting to the account, debiting from the account of profits or expenses in foreign hard currency. The indicated dates also characterize the date of reflection in the reporting of the corresponding changes in the value of the open monetary position. The value of an open monetary position is based on reliable accounting information, reflecting claims to acquire and promises to deliver funds in designated currencies, both for transactions completed with settlements in real terms on the reporting date, but also for transactions for which settlements will be completed in the future, after the reporting date . Traditionally, the value of the cash position is calculated using hard currency for an explicit period relative to the state hard currency. In the case of active participation in international operations, the bank must constantly keep records of open positions in the relevant currencies.

These positions demonstrate unfinished transactions in a specific hard currency at any time, regardless of the timing of transactions. An assessment of the likely outcome of closing an open position is achieved by recalculating all amounts of long and sell positions into national hard currency at the current rate at which transactions have every chance of being covered, taking into account the delivery time of hard currency for urgent transactions, in other words, the date of execution of the terms of the transaction. This recalculation is carried out in 2 steps: first, all positions are recalculated into a more common hard currency, for example, the dollar, then the dollar amounts or their total - into the national hard currency.

Factors influencing the currency position

Transactions that have a major impact on changes in the cash position include:

receiving interest and other earnings in foreign currencies;

payment of interest and other costs in foreign currencies;

for the purchase of own funds in foreign currencies;

conversion transactions with immediate delivery of funds, no later than 2 working banking days from the date of decision of the transaction, and their delivery for a period greater than 2 working banking days from the date of decision of the transaction, including transactions with cash foreign hard currency;

urgent transactions, including forward and futures transactions, settlement forwards, " " transactions, options, for which claims and promises appear in foreign hard currency, regardless of the method and form of settlement for these transactions;

other transactions in foreign hard currency and transactions with other monetary values, not counting precious metals, including derivative monetary instruments of the currency market, even the exchange market, if the terms of these transactions in some form take into account the exchange, in other words, the conversion of foreign hard currency or monetary values, excluding valuable metals;

purchased irrevocable guarantees denominated in foreign hard currency. Included in the calculation of the open cash position from episode 1 of non-payment on the loan for which security was received;
issued irrevocable guarantees denominated in foreign hard currency. They are included in the calculation of the open monetary position from the stage when, according to the target assessment of the authorized bank, it becomes possible for the beneficiary to submit claims for payment of a foreign currency amount.

Banks will try to hold long cash positions in strong currencies, especially when they expect their exchange rates to increase, and short positions in weak currencies. If unexpected changes in monetary exchange rates occur: a strong hard currency becomes cheaper and a weak hard currency rises in price, then the bank has probable expenses of its funds, which it is given the opportunity not to note, but to wait until the hard currency of the long position rises in price again, and the hard currency of the short position becomes cheaper, after This is to close the open position with a profit.

To avoid monetary risk, it is necessary to coordinate assets and liabilities for any hard currency, and also strive to form an overlapped position for any hard currency at the end of the period, or it is possible to compensate for the imbalance of assets and liabilities in foreign hard currency by the discrepancy between the sizes of sold and acquired hard currency, thereby reducing the monetary risk to zero, following the principle: a sell position in some foreign currency can be offset by a long cash position, if the size, expiration date and hard currency of these positions are similar. This principle is especially important because it serves as a prototype for all methods of covering monetary risk.

The value of losses or income generated when the monetary exchange rate changes, embodied in the state hard currency, is oriented as the product of an open monetary position in a predetermined hard currency by the change in the rate of the state hard currency relative to this hard currency, in other words, by adjusting the value of the monetary position, you can influence the value of losses.

The bank is obliged to constantly review the state of the open monetary position solely for the purpose of monitoring compliance with the limits of the open monetary position established by the Central Bank of the country, and also for the purpose of analyzing possible expenditures of its funds and profits associated with maintaining an open monetary position.

Ways to regulate the monetary risk of a currency position

There are 2 main ways to regulate monetary risk: limiting, mandatory and voluntary. Hedging is a method of adjusting monetary risk, based on the development of a compensating monetary position, in which selective or absolute compensation of one monetary risk occurs with another suitable risk. A restriction is a method of adjusting a monetary position, based on an indispensable or voluntary limiting of the values of the bank's open monetary position in accordance with established limits.

Hedging instruments are used by banks to adjust the values of open cash positions with the goal of completely closing them, reducing them, or conducting these transactions with foreign hard currency, which will not lead to a future increase in the values of the cash position for a predetermined hard currency or group of currencies. The instruments for hedging a bank's open cash positions are: solving various types of balancing immediate and cash transactions for the purchase and sale of hard currency; premature refusal to perform, extension of a previously concluded transaction; solving transactions similar to “swap”, as well as conducting operations that do not involve the exchange of one foreign currency for another; offsetting existing claims and obligations with one counterparty for the greatest reduction in monetary transactions by the method of their consolidation.

Limitation, in contrast to hedging, is used both by banks and by control authorities and consists of a voluntary, on the part of the bank, or an indispensable, prescribed by the control authority, limiting the value of the bank’s open cash positions in accordance with established limits.

The more fundamental features of the quality of the cash position management process at the bank level include: efficiency and sophistication of banking information systems; skill, knowledge, professionalism and interest of management and staff. This process must be supported by adequate banking technology and be based on a correct, reliable accounting system in a credit institution.

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Cash flow statement: preparation and disclosure of information according to IFRS requirements
Net cash position beginning of period 100 - -3,576,767 -3,576,767 -3,576,767 -3,576,767 -2,576,031 Net cash position ending period 110 -3,197,010 -1,901,247 -2,153,272
Improving the financial reporting model under IFRS
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Valuation of shares and the value of commercial organizations based on a new financial reporting model
Other components of net operating assets 441 152 463 387 486 556 510 884 526 210 541 997 558 256 Net operating assets 6 636 832 7 537 208 7 914 068 8 076 091 ... Free cash flow forecast from operating activities Operating profit 839 051 790 846 830 389 871
Balancing the solvency of an enterprise and the liquidity of its financial resources
LDP's liquid cash flow or change in net credit position is an indicator of excess or deficit balance
Anti-crisis management as a tool for financial stabilization of an enterprise
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Specifics of assessing receivables and payables of an enterprise
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Two contours of interests in the company’s financial health policy
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“Imaginary” liabilities taken into account when calculating the organization’s net assets
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Financial flow management in holding structures
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Reflection of information on financial assets in financial statements in accordance with IFRS
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In the trading system - the amount of cash balance that can be used as security for applications for the purchase of bonds during trading.

- interpretation of the role of money as a value shell of real processes...
Large economic dictionary
- Part of the money supply that is recognized as reserves of the banking system...
Economic dictionary
- the assertion that a reduction in the money supply is the cause of most economic crises. Proponents of this hypothesis are A. Schwartz and M. Friedman...
Economic dictionary
- interpretation of the role of money as a value shell of real material processes...
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Dictionary of depository terms
- The set of rights and obligations of a Section Member arising as a result of concluding a purchase/sale transaction of one fixed-term instrument of this series. A position can be long or short in its direction...
Dictionary of depository terms
- this is the arrangement of monetary circulation in a given country, enshrined in law and providing for bringing various elements of monetary circulation into a certain unity...
Dictionary of business terms
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Dictionary of business terms
- The position of a broker engaged in trading securities, as well as exchange commodities, currencies, etc., in which his sales of securities exceed the volume of securities available to him...
Dictionary of business terms
- the money supply in circulation, including cash, accounts and reserves of commercial banks and other financial assets. In English: Monetary baseSm. See also: Monetary aggregates ...
Financial Dictionary
- in the Russian Federation - a monetary aggregate, including investments of depository institutions in funds that can be used to cover reserve requirements...
Financial Dictionary
- in the Russian Federation - the volume of cash in circulation M0 and balances in national currency on settlement accounts and deposits of non-financial enterprises, organizations and individuals who are residents of the Russian Federation. The M2 unit does not...
Financial Dictionary
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Large economic dictionary
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Economic dictionary
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Great Accounting Dictionary
- ....
Encyclopedic Dictionary of Economics and Law

"MONEY POSITION" in books

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47. US monetary system

From the book Money. Credit. Banks [Answers to exam papers] author Varlamova Tatyana Petrovna

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51. Currency reform

From the book Money, Credit, Banks. Cheat sheets author Obraztsova Lyudmila Nikolaevna

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From the book New Client Generator. 99 ways to attract buyers en masse author Mrochkovsky Nikolay Sergeevich

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Single Cash Position (SMP) is a modern service with great margin trading capabilities, available in our MATRIx trading system. The EDP has replaced the rigid division of a brokerage account into several trading platforms, but if desired, the client can open separate accounts, the balances of which will not be taken into account in the Single Cash Position.

Together with the Single Money Position, you will have a single “Money” (MO) account, which can be used on several trading platforms at once:

Stock market of the Moscow Exchange (all instruments traded in T+2 mode)
Moscow Exchange derivatives market (futures, options)
Foreign exchange market and precious metals market of the Moscow Exchange (non-deliverable mode)
Foreign securities market of the St. Petersburg Exchange

Assets that were purchased on one market trading platform can be used as collateral in other markets included in a single monetary position.

In addition to the personal accounts that are included in the EDP and are combined within one money account with the suffix - MO (Money), the MATRIx trading system may contain personal accounts (portfolios) not included in the EDP. The old suffixes are retained for them. Assets in these accounts cannot serve as collateral for transactions in other accounts. Including for accounts included in the EDP.

A single cash position is convenient because:

You have access to a single risk management for all trading platforms.

You have the opportunity to balance risk across correlated instruments.

The amounts of guarantee collateral and the cost of funding operations will be lower.

You will be able to use previously unavailable arbitrage operations.

The shoulder size will be increased.

You will not need to transfer funds between sites included in the Unified Cash Position.

Example 1: Reducing the amount of guarantee collateral. LKOH (OJSC NK Lukoil) shares purchased with “our own” money (without “leverage”) are collateral for a position on a futures contract on the RTS index.

Example 2: Risk balancing for correlated instruments. The purchased shares of SBER (Sberbank PJSC) are collateral for a short position under the futures contract SBRF-6.18 (June futures for shares of Sberbank PJSC) and form an arbitrage pair, the risks of which are balanced.

Example* Buying 100 shares of SBER and selling 1 futures contract SBRF-6.18

Share price: RUB 21,426. The initial margin for opening a position is RUB 9,411.

Futures contract price: RUB 21,719. GO - 4,202 rub.

Settlements on trading platforms that are part of the EDP occur on a single MO account.

I read the book “The Peter Lynch Method. Strategy and tactics of the individual investor." In his book, Peter Lynch reveals a lot of different information about what you should pay attention to when buying American stocks. For myself, from this book I highlighted the chapter “key investor indicators”, which I will briefly outline in this article. Even though this book is about the American market, I think we can take something from it and apply it to our reality on the Russian market.

Indicators that you should pay attention to when deciding whether to buy a stock. The order in which they appear is not related to their significance:

1. Share of sales.

If the company's interest is due to a particular product, the first step is to find out what this product means for the company, what is its share in the company's sales. If the share of sales of products you are interested in in the total income of the enterprise is not large (less than 10%), then you should not choose this company to buy shares only because of the product. You need to ask if there is another manufacturer of this product or forget about it.

2. P/E ratio

Serious earnings analysis involves the ratio of a stock's price to its earnings, known as the P/E ratio or multiple. This coefficient numerically characterizes the relationship between the stock price and the company's profit. The P/E ratio helps you understand whether a stock is overvalued or undervalued relative to the company's earnings potential. The P/E ratio can be thought of as the number of years it will take to pay back the initial investment, assuming earnings remain the same.

If you buy shares whose price is twice as high as earnings (P/E=2), then the initial investment will pay off in two years, and if its price is 40 times higher (P/E=40), then after 40 years. Slow-growing companies have the lowest P/Es, high-growth companies have the highest P/Es, and cyclicals have the highest P/Es. Below average P/E is (7-9), average P/E is (10-14), above average P/E (14-20). But buying shares just because a company's P/E is low makes no sense.

A company with fairly priced shares has a P/E equal to its earnings growth rate. For example, Coca-Cola, with an equal P/E of 15, should grow profits by 15% per year. If P/E half as much profit growth rate, this is considered very positive signal if at two more growth rate is very negative.

3. Cash position

You need to read the company's consolidated balance sheet, which shows assets and liabilities. Pay attention to short-term assets in the form of cash and cash equivalents, plus in the form of liquid shares. These two items constitute the cash position.

It is also necessary to refer to the second part of the balance sheet, namely the article “ Long-term loans". A reduction in debt obligations compared to previous years is a sign of prosperity. A cash position that far exceeds debt obligations improves the balance sheet. A lower cash position worsens the balance sheet. The calculations do not take into account short-term debt, given that the value of the company's other assets (inventory, etc.) exceeds short-term debt obligations.

Need to determine net cash position from the company's prepared statement by subtracting long-term debt from the cash position. Often long-term liabilities are higher than the cash position, cash items are reduced, debt increases, and the company has a weak financial position.

Dividing the net cash position by the number of issued shares of the company shows that per 1 share there is N amount of cash, this indicator is important. He says that N is the amount of cash per share, a kind of paper bonus that represents a hidden return of money. In addition, information about the company's own share repurchase is also important, which is a good sign. It is also necessary to take into account information about whether profits are growing and whether dividends are always paid. The purpose of a brief analysis is to find out whether the company's position is weak or strong.

4. Share of borrowed funds

How much does the company owe and how much debt does it have? Debt versus equity. This is the question that a credit officer is interested in when determining your credit risk.

A company's financial strength can be quickly assessed by comparing equity with debt on the right side of the balance sheet. It is necessary to calculate the debt/equity ratio (total share capital of the company).” In a normal balance sheet, equity should account for 75% and debt should account for 25% of the ratio. Short-term liabilities can be ignored when assessing if there are enough cash to cover them. Weak balance if 80% debt, and 20% equity.

Bank loans are the worst type of borrowing and are repayable on demand. Bond loans are the best type of borrowing; they do not provide for payment on demand while the borrower pays interest.

5. Dividends

Those who pay dividends are not inclined to throw away money on diversification. Dividends keep stocks from falling to a certain extent. On the other hand, smaller companies that do not pay dividends and use the money to expand profits often demonstrate faster growth. prefers a company with an aggressive growth policy over boring companies that pay stable dividends. If you are buying a company's shares for the stability of its dividend payments, ask about the company's ability to pay them during downturns and financial difficulties. The best option for an investor is a company that increases dividends for 20-30 years.

6. Book value

Book value often has no relation to the actual value of the company. It is either higher or lower than the real value of the company. Overvalued assets are especially treacherous when there is a lot of debt.

Hidden assets: The book value is lower than the actual value as often as it is higher. Companies that own natural resources (land, timber, oil, precious metals) or brands like Coca-Cola may only show a fraction of their true value on their balance sheet.

7. Cash flow

Cash flow is the amount of money a company receives as a result of its activities. All companies receive funds, but the costs associated with receiving them are different for everyone. If it requires significant expenses to generate cash, the company will not be able to get very far. You need to take into account free cash flow - this is the money that remains after subtracting capital costs.

Cash flow is used to value a stock. A stock priced at $20 with annual cash flow of $2 per share has a standard ratio of 1/10. This 10% cash flow yield represents the stock's minimum expected return over the long term.

8. Inventories

Peter Lynch looks at whether stocks are increasing. If a company boasts of growth of 10%, but inventories increase by 30%, this is a bad signal. The company should compromise on price and get rid of inventory. Otherwise, she may face problems next year. New products will compete with old ones, and as a result, inventories will increase so much that the company will have to greatly reduce prices, and therefore profits. Rising inventories aren't as bad for auto companies.

9. Pension plans

The absence of pension obligations is a big plus. Even in bankruptcy, the company is obliged to fulfill pension obligations.

10. Growth themes

A business that, despite annual price increases, retains its clientele is an excellent investment opportunity. All other things being equal, a company with a growth rate of 20% and a P/E of 20 is a much better acquisition than a company with a growth rate of 10% and a P/E of 10.

11. Summary

The bottom line is the number at the end of the income statement, in other words profit after tax. Profit before taxes or gross profit is the main indicator by which a company is evaluated. It shows what is left of annual sales revenue after subtracting all costs, including depreciation and interest payments. Comparing the gross profit of companies in different industries is of little use; comparison in the same industry is another matter. The company with the highest gross profit is the lowest cost business, and the business in turn has the highest chance of survival.

Here is a brief summary of the important points of the book that I wrote; they were the first things I noticed when reading it.