Market manipulation March 16, 2023. How loopholes in the laws and regulations of the Moscow Exchange work against retail investors

In an environment where the non-cash dollar is considered a toxic currency, many investors switched to operations with futures on the dollar. Unlike the dollar itself, futures are denominated in rubles and allow you to save money or play on exchange rates while being in the legal field of the Russian Federation.

However, on March 16, 2023, there was a serious market manipulation, to which the supervisory authorities have not yet reacted in any way in the sense of canceling transactions or any punishment of participants, although there is Federal Law No. 224-FZ of July 27, 2010 (as amended on October 7, 2022) against market manipulation.

And even in the criminal code there is
Article 185.3. “Market Manipulation”.

essence of manipulation. Short.

Large players with a “long” position in the futures made many transactions to buy the dollar (underlying asset USDRUB_TOM) within 5 minutes and pushed the dollar up by about 1 ruble 30 kopecks. All players with a short position suffered additional losses.

essence of manipulation. Detailed.

Futures for the supply of the dollar were settlement. This means that at the moment of termination of the futures, money is credited to the account of the holders of short or long positions in accordance with the price of the underlying asset (dollar).

Each futures contract has 2 parties: the one who bought it and the one who sold it. And accordingly, if someone won with the growth of the futures, then there is someone who lost. Since money is transferred from one exchange account to another, depending on fluctuations in the exchange rate of the underlying asset (dollar). This money is called “variation margin”.

SI-3.23 futures were valid until 14:00 March 16. However, according to the rules of the Moscow Exchange, the settlement price of the futures (fixing) is set as the average for the time period from 12:25 to 12:30. Just 5 minutes Carl!

The fact that the fixing price is determined not in the last hour, and not even in the last day is extremely strange. Here you can suspect a special hole in the rules for those who are in the know.

During these ill-fated 5 minutes, a huge volume of transactions was carried out. According to source it was “nearly half of the average daily trading volume over the past 10 days.”

More information from the same source:

So, below is the per-minute USDRUB_TOM chart for today, 03/16/2023. Find the 12:25-12:30 interval on it, if you can.

NOT manipulation of the NOT market (Si-3.23) For how long?

Actually, the volume for USDRUB_TOM was
at 12:25 — 135 243
at 12:26 — 71 010
at 12:27 — 46 315
at 12:28 — 58 287
at 12:29 — 106 379
at 12:30 — 24 764
Total: 441,998

After determining the fixing, the futures for some reason is traded on the stock exchange for another 1.5 hours. Although its price at expiration is already rigidly determined. As if this was done in order to cheat a little more small players who do not know this strange rule of the Moscow Exchange.

How can you inexpensively and believably raise the course of anything

In fact, driving up the dollar for 5 minutes on a “thin” market and even providing huge volumes for credibility is a very simple task, since the exchange uses the FIFO principle when trading on each position in the order book. “First in, first out.” Those applications that are received earlier are processed earlier.

An example of an order book with manipulative orders

Therefore, even the average player, if he places his own buy orders in the order book ahead of others at each price level, will not spend much money on manipulation.

Since it is necessary to ensure a price jump within only 5 minutes, many serious players with very large amounts simply will not have time to do anything until they figure out how justified this price jump is.

For secrecy, these applications can be placed on behalf of the partner. The manipulator de facto will lose only the exchange commission, which is cheap for large players. Well, the delta from small applications of ordinary players.

Moreover, in the law on combating market manipulation, such things as inflating the volume of transactions are also recognized as manipulation, as well as buying from oneself or affiliates.

Yes, all this can be done and without tricks in a glass at all. Just empty the glass. For a major player, this is real.

As a result, the fixing price was 76.82 rubles, while the dollar exchange rate at the time of the futures expiration was around 76.26 rubles.

This means that each owner of 1 short futures lost 560 rubles. And the one who had, for example, 1,000,000 futures earned 560 million in 5 minutes on this manipulation.

I think it’s unfair. In the US, large shareholders must warn the market ahead of time about major transactions. This shows concern for investors. The more strictly protected the rights of investors, the healthier the financial market. And Russia clearly needs this to become a financial center that attracts investors.

Reaction Nabiullina

“We do not see any speculative actions. But there were indeed course movements, especially in mid-March. This is due to the fact that we saw a concentration of open positions on the eve of expiration (execution. – Forbes) on the exchange of futures contracts, ”Nabiullina said. Source.

“Mid March” – ha ha ha. The manipulation was within 5 minutes, and not in the abstract “mid-March”.


  1. I ask you to consider this post as an appeal to the Prosecutor’s Office of the Russian Federation, the Moscow Stock Exchange and the Central Bank of the Russian Federation in order to investigate the manipulation and return the money to all affected investors.
  2. In the conditions of the thin Russian market, large players that can affect the exchange rate – exporters and, possibly, banks, must report on their positions in futures for currency pairs. Otherwise, small players are completely defenseless in front of them.
  3. And the Moscow Exchange should change the holey rules of fixing, making the calculation of the average price for the last hour or even a day, and not for 5 minutes in the middle of the trading day as it is now.
  4. Definitely, some kind of public organization is needed that will protect the rights of retail investors and write statements to the prosecutor’s office, the Central Bank and other authorities in case of such market manipulations.

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