Podcast
Questions and Answers
Who is responsible for determining the contract specifications of IRC securities?
Who is responsible for determining the contract specifications of IRC securities?
- JSE trading members
- Market analysts
- JSE Executive (correct)
- Financial regulatory authority
What action can the JSE NOT take regarding futures and option contracts?
What action can the JSE NOT take regarding futures and option contracts?
- Set contract specifications independently (correct)
- Amend existing conditions
- Notify trading members of additions
- Remove futures and option contracts from the list
In what scenario must the JSE specify an expiry date for a futures or option contract?
In what scenario must the JSE specify an expiry date for a futures or option contract?
- If the expiry is less than six months
- For all futures and option contracts
- If the expiry is longer than one year (correct)
- When members request it
What is a consequence of the JSE suspending an IRC security from its list?
What is a consequence of the JSE suspending an IRC security from its list?
What types of derivatives are included in the IRC securities as stated?
What types of derivatives are included in the IRC securities as stated?
What is required from the JSE when they add or remove a futures or option contract?
What is required from the JSE when they add or remove a futures or option contract?
What type of public communication may the JSE employ related to IRC securities?
What type of public communication may the JSE employ related to IRC securities?
What is one of the measures the JSE may take when determining contract specifications of IRC securities?
What is one of the measures the JSE may take when determining contract specifications of IRC securities?
What is one of the main advantages of using the JSE's Interest Rate Derivatives Market?
What is one of the main advantages of using the JSE's Interest Rate Derivatives Market?
Which of the following is NOT listed as an Interest Rate Derivative in the JSE's market?
Which of the following is NOT listed as an Interest Rate Derivative in the JSE's market?
Who can actively participate in trading Interest Rate Derivatives according to the outlined requirements?
Who can actively participate in trading Interest Rate Derivatives according to the outlined requirements?
What type of surveillance does the JSE conduct on Interest Rate Derivative transactions?
What type of surveillance does the JSE conduct on Interest Rate Derivative transactions?
In what way can traders execute trades in the JSE's Interest Rate Derivatives Market?
In what way can traders execute trades in the JSE's Interest Rate Derivatives Market?
Which financial instruments fall under the category of Short Term Interest Rate Futures (STIRs) as stated by the JSE?
Which financial instruments fall under the category of Short Term Interest Rate Futures (STIRs) as stated by the JSE?
What does the JSE require from members who wish to trade within the Interest Rate Derivatives Market?
What does the JSE require from members who wish to trade within the Interest Rate Derivatives Market?
What kind of derivatives can be found on the JSE within the category of Long Term Interest Rate Futures (LTIRs)?
What kind of derivatives can be found on the JSE within the category of Long Term Interest Rate Futures (LTIRs)?
What may the JSE do with futures and option contracts in relation to their listing?
What may the JSE do with futures and option contracts in relation to their listing?
What must the JSE do when it imposes new conditions on futures and option contracts?
What must the JSE do when it imposes new conditions on futures and option contracts?
When may the JSE publish conclusions or findings regarding an investigation?
When may the JSE publish conclusions or findings regarding an investigation?
Which factor is NOT considered by the JSE when determining contract specifications for IRC securities?
Which factor is NOT considered by the JSE when determining contract specifications for IRC securities?
What is a potential outcome of the JSE suspending an IRC security?
What is a potential outcome of the JSE suspending an IRC security?
What does the JSE specify when the expiry date of a futures or option contract exceeds one year?
What does the JSE specify when the expiry date of a futures or option contract exceeds one year?
What type of communication may the JSE utilize to inform the public about changes to IRC securities?
What type of communication may the JSE utilize to inform the public about changes to IRC securities?
Which of the following actions regarding the IRC securities is at the discretion of the JSE?
Which of the following actions regarding the IRC securities is at the discretion of the JSE?
What reduces counterparty credit risk in the JSE's Interest Rate Derivatives Market?
What reduces counterparty credit risk in the JSE's Interest Rate Derivatives Market?
Which of these is a requirement for market participants looking to trade in the Interest Rate Derivatives Market?
Which of these is a requirement for market participants looking to trade in the Interest Rate Derivatives Market?
What is included in the list of Interest Rate Derivatives according to JSE guidelines?
What is included in the list of Interest Rate Derivatives according to JSE guidelines?
Which aspect of trading in the Interest Rate Derivatives Market provides functionality for booking trades?
Which aspect of trading in the Interest Rate Derivatives Market provides functionality for booking trades?
Who can act as a client to trade in the Interest Rate Derivatives Market?
Who can act as a client to trade in the Interest Rate Derivatives Market?
Which of the following is NOT a listed interest rate derivative on the JSE?
Which of the following is NOT a listed interest rate derivative on the JSE?
What primary action is taken by the JSE to ensure fair pricing of Interest Rate Derivative transactions?
What primary action is taken by the JSE to ensure fair pricing of Interest Rate Derivative transactions?
What type of market members can potentially participate in the JSE's Interest Rate Derivatives Market?
What type of market members can potentially participate in the JSE's Interest Rate Derivatives Market?
Study Notes
IRC Securities Overview
- JSE maintains the list of IRC securities under section 11(8)(a) of the Financial Markets Act.
- Interest rate derivatives available for trading include various futures and options on government and state-owned company debt.
Types of Interest Rate Derivatives
- Futures and Options: Based on government debt and State-owned company debt, including Bond Futures, Bond Options, and Index Futures.
- Short-term Interest Rate Futures (STIRs): Includes Jibar Futures.
- Long-term Interest Rate Futures (LTIRs): Includes Swap Futures.
Trading Execution and Risk Management
- Interest Rate Derivatives can be booked through both on-screen and off-screen methods.
- All positions are margined and cleared by the JSE Clear, minimizing counterparty credit risk.
- Real-time transaction surveillance is conducted by the JSE regulatory team to ensure compliance and fair pricing.
Market Participation
- Active trading participation is open to individuals or entities that comply with JSE's market requirements.
- Clients may trade through members who are compliant, such as brokers, banks, and asset managers.
Contract Specifications
- JSE determines contract specifications for IRC securities, which may change based on market research and member feedback.
- Specific expiry months for futures and options contracts are decided and published by the JSE.
Listing and Adjustments
- JSE can add, remove, or suspend futures and options from the list of IRC securities as necessary.
- Notification of any changes or conditions regarding contracts is provided to trading members by the JSE.
Investigations and Notifications
- The JSE has the authority to remove or suspend IRC securities and to investigate dealings.
- Reasons for actions taken regarding listing status or investigations are published, ensuring transparency.
IRC Securities Overview
- JSE maintains the list of IRC securities under section 11(8)(a) of the Financial Markets Act.
- Interest rate derivatives available for trading include various futures and options on government and state-owned company debt.
Types of Interest Rate Derivatives
- Futures and Options: Based on government debt and State-owned company debt, including Bond Futures, Bond Options, and Index Futures.
- Short-term Interest Rate Futures (STIRs): Includes Jibar Futures.
- Long-term Interest Rate Futures (LTIRs): Includes Swap Futures.
Trading Execution and Risk Management
- Interest Rate Derivatives can be booked through both on-screen and off-screen methods.
- All positions are margined and cleared by the JSE Clear, minimizing counterparty credit risk.
- Real-time transaction surveillance is conducted by the JSE regulatory team to ensure compliance and fair pricing.
Market Participation
- Active trading participation is open to individuals or entities that comply with JSE's market requirements.
- Clients may trade through members who are compliant, such as brokers, banks, and asset managers.
Contract Specifications
- JSE determines contract specifications for IRC securities, which may change based on market research and member feedback.
- Specific expiry months for futures and options contracts are decided and published by the JSE.
Listing and Adjustments
- JSE can add, remove, or suspend futures and options from the list of IRC securities as necessary.
- Notification of any changes or conditions regarding contracts is provided to trading members by the JSE.
Investigations and Notifications
- The JSE has the authority to remove or suspend IRC securities and to investigate dealings.
- Reasons for actions taken regarding listing status or investigations are published, ensuring transparency.
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Description
This quiz covers the list of IRC securities that can be traded on the IRC markets according to the IRC Rules. It includes various interest rate derivatives such as futures and options on government debt, as well as STIRs and LTIRs. Test your knowledge on the role of the JSE and the specifics of these financial instruments.
