The RUSFAR index has been calculated by the Moscow Stock Exchange since April 2019 and shows the fair value of collateralized money. It has been applied to yuan-denominated assets since last September. This year, the first insurance programs based on it appeared on the Russian market.
There are two important indicators in the Russian securities market: RUONIA (Ruble Overnight Index Average) and RUSFAR (Russian Margined Funding Average Ratio). The first of these measures liquidity for banks in the interbank market. This is the “reference” rate for unsecured interbank loans on an “overnight” basis in rubles, that is, for one day. It is managed by the Central Bank of Russia.
With similar values and dynamics, RUSFAR is calculated for up to three months and can be used by the investor to determine the yield on short-term bonds with minimal risk. This indicator is calculated based on REPO transactions. (transactions for the purchase of a security with an obligation to resell it at a predetermined price after a certain period. – “socialbites.ca”) using clearing participation certificates (CPC) and the top 20 market makers (banks, large funds, brokers) participate in its formation.
GCC is issued in exchange for contributed assets – one security for every participation ruble. This is a kind of collateral for transactions. Around 200 banks, brokers and other financial companies can join them. Therefore, this indicator is able to more accurately reflect the true value of money, and the desire for such indicators in general has already become a global trend.
While RUONIA serves to evaluate the effectiveness of monetary policy in the country and is mainly used for interbank payments, the RUSFAR indicator was created for all institutional investors who have the opportunity to meet their requirements for connecting to the Moscow Stock Exchange and interacting with other exchanges. participants. It was created on the basis of the most liquid market segment.
Since September 2022, the Moscow Exchange determines not only the ruble and dollar rate, but also the RUSFAR CNY in yuan, and since July 2023, an additional RUSFAR CNY real-time indicator updated every 15 minutes from 10 introduced: 00 – 12:30 Moscow time
A number of financial instruments are associated with RUSFAR. For example, the same mutual funds (mutual funds) that deposit money through the REPO and give rise to the index. Exchange-traded mutual funds (BPIFs) are focused on this and are now the first life insurance product on the Russian market to offer daily profitability and full capital protection.
The new insurance product allows novice investors to try themselves in this area using a transparent tool with a small entry threshold (from 50 thousand rubles). In the near future, customers will be able to withdraw and renew the contract. The main advantage of the product is the accrual of daily income. The new product is calculated on the basis of RUSFAR ON RUB. The customer’s money is instantly transferred to the insurance units and deposited at the current effective money market rate.
At the same time, the capital is 100% protected by the insurance company, ie the size of the insurance unit cannot be less than the size at the time the contract was signed.
The main advantage of such products is the absence of withdrawals, since daily placement on the money market will only capitalize a permanent income.
The dependence of the product on RUSFAR also exempts the client from paying personal income tax on product income, since the placement rate will always be slightly lower than the key rate of the Central Bank of the Russian Federation.
The person receives tax, inheritance and legal privileges, in case of an insured event, it is easier to transfer these investments to heirs if they are registered as beneficiaries. You can even apply for a tax deduction and return part of the funds (currently from the maximum investment amount of 120 thousand rubles, and from 2024 – from 150 thousand rubles).
The author expresses his personal opinion, which may not coincide with the editors’ position.