Derivatives MarketNovember 2015

1

AT A GLANCE

Borsa Istanbul Derivatives Market (VIOP) is the region’s leading and most liquid derivatives marketplace, offering futures & option contracts based on equity, equity index, currency, precious metals, commodity, interest rate and ETF Takasbank provides Central Counterparty (CCP) clearing services for all VIOP contracts

NASDAQ Technology to be implemented at VIOP in 2016

Strategic partnership agreement with London Stock Exchange Quick facts 64% retail flow with 100,000 accounts

32% increase in trade volume in Jan-Sep 2015

~1 billion USD daily turnover

Exchange Hosting Service

PoP London Equinix LD5

66 active members

FIX Protocol

2

FUTURES AT

VIOP Futures

Contracts

Single Stocks

Equity Index BIST 30 Index

USD/TRY, EUR/TRY, EUR/USD

TRY Gold, USD Gold

Cotton, Wheat

Electricity

SASX 10

FBIST Bond ETF

Turkish Steel Scrap

Precious Metals

Foreign Index

ETF

Metal

Overnight Repo RateInterest Rate

Commodity

Energy

FX

AKBNK, EREGL, GARAN, ISCTR, SAHOL, TCELL, THYAO, TUPRS, VAKBN, YKBNK

3

OPTIONS AT

SingleStocks

EquityIndex BIST 30 Index, Mini BIST 30 Index

FX USD/TRY

AKBNK, EREGL, GARAN, ISCTR, SAHOL, TCELL, THYAO, TUPRS, VAKBN, YKBNK

VIOP Option

Contracts

4

RECORDS OF 2015

VIOP keeps on setting new records in 2015All time high records (2005-2015) of monthly/daily trade volume, number of orders,USD/TRY FX open interest

August 2015

Monthly Total Trade Volume 53 billion TRY

13 August 2015

# of Orders Entered in a Day 747,690

27 February 2015

USD/TRY FX Futures DailyTrade Volume 1 billion TRY

25 February 2015

Daily Trade Volume 5 billion TRY

25 May 2015

Open Interest in FX Futures 408,735

June 2015

FX Futures Monthly TradeVolume

8.9 billion TRY

5

TRADE VOLUME

In Jan-Sep 2015, trade volume went up by 32% compared to the same period last year

* Figure includes the first nine months of 2015.

Trade Volume (bln TRY)

Bill

ion

TRY

700

403.9

2012 2013 2014 2015* 2015E

416.6 435.7416.4

576.3

32%600

500

400

300

200

100

0

6

TOTAL NUMBER OF CONTRACTS TRADED

In Jan-Sep 2015, total number of contracts traded went up by 48% compared to the same period last year. In 2014, it increased by 11%

Number of Contracts Traded (mln)

Mill

ion 90

80

100

70605040302010

53.559.5 64.6

88.1

2013 2014 2015* 2015E

48%

0

* Figure includes the first nine months of 2015.

7

HIGH RETAIL LIQUIDITY

64% of daily trade volume is executed by retail investor base

Retail

Institutional

* Figure includes the first nine months of 2015.

64%

36%2015*

8

2015* TRADE VOLUME

32% increase in total trade volume in 2015

* The first nine months data of 2014 and 2015

Contract TypeTrade Volume (TRY)

2014*Trade Volume (TRY)

2015*Change

(2014-2015*)

Index Futures 290,028,466,468 337,273,705,285 16%

Index Options 643,602,000 2,016,901,600 213%

Single Stock Futures 10,689,109 1,260,031,375 11,688%

Single Stock Options 19,398,950 306,590,275 1,480%

FX Futures 22,968,314,653 73,356,426,459 219%

FX Options 7,338,100 1,302,457,725 17,649%

Precious Metals Futures 1,394,156,065 1,141,187,075 -18%

Energy Futures 398,692 60,165,736 14,991%

Total 315,072,364,037 416,728,261,280 32%

9

2015* TRADE QUANTITY

49% increase in total trade volume in 2015

* The first nine months data of 2014 and 2015

Contract TypeTrade Quantity

2014*Trade Quantity

2015*Change

(2014-2015*)

Index Futures 32,272,416 33,586,853 4%

Index Options 72,549 204,463 182%

Single Stock Futures 16,003 1,866,040 11,561%

Single Stock Options 25,691 492,687 1,818%

FX Futures 10,169,300 26,762,155 163%

FX Options 3,411 471,008 13,709%

Precious Metals Futures 951,588 1,230,091 29%

Energy Futures 31 5,395 17,303%

Total 43,510,979 64,623,339 49%

10

2015* FUTURES vs OPTIONS

* The first nine months data of 2014 and 2015

Contract TypeTrade Volume (TRY)

2014*Trade Volume (TRY)

2015*Change

(2014-2015*)

Futures 314,402,024,987 413,102,311,575 31%

Options 670,339,050 3,625,949,705 441%

Total 315,072,364,037 416,728,261,280 32%

Contract TypeTrade Quantity

2014*Trade Quantity

2015*Change

(2014-2015*)

Futures 43,409,328 63,455,181 46%

Options 101,651 1,168,158 1,049%

Total 43,510,979 64,623,339 49%

11

FX FUTURES

* Figure includes the first nine months of 2015.

2013 2014 2015* 2015E

FX Futures Trade Volume (mln TRY)

Mill

ion

TRY 120.000

100.00080.00060.00040.00020.000

0

22.72731.986

73.356

102.158219%

41%

In Jan-Sep 2015, trade volume went up by 219% and reached to 73 billion TRY. In 2014, total trade volume in FX futures went up by 41% and reached to 32 billion TRY compared to 2013

12

PRODUCT BREAKDOWN

*Includes the first nine months of 2015

Breakdown of Trade Volume in 2015* Breakdown of Trade Volume in 2014

80.93% 91.94%

17.60%0.30%

0.31%0.48%

0.07%0.27%

7.34%0.01%

0.23%0.43%

003%0.01%

Index Futures-80.93%Currency Futures-17.60%

Index Options-0.48%Precious Metals Futures-0.27%Currency Options-0.31%Single Stock Futures-0.30%

Single Stock Options-0.07% Currency Options-0.01%

Index Futures-91.94%Currency Futures-7.34%

Index Options-0.23%

Single Stock Futures-0.03%Precious Metals Futures-0.43%Single Stock Options-0.01%

13

OPEN INTEREST

In Jan-Sep 2015, total open interest went up by 79% compared to the same period last year and reached to 800,000 contracts. In 2014, total open interest went up by 23% compared to the last year and reached to 479,000 contracts

January

February

March AprilMay

June

July

August

Septem

ber

October

November

Decem

ber0

201320142015

1,200,000

1,000,000

800,000

600,000

400,000

200,000

14

FOREIGN vs DOMESTIC

Foreign investor’s share in Derivatives Market is almost doubled to29% in 2015

* Figure includes the first nine months of 2015.

2011 201420132012 2015*

90

80

70

60

50

40

30

20

10

0

% 85

15 16

25 24

84

75 7671

DomesticForeign

29

15

BREAKDOWN OF TRADE VOLUME BY RESIDENCE*

Other Countries (stated with « » ): Switzerland, Iceland, Germany, Belize, Panama, Singapore, The Bahamas, Bulgaria, Croatia, Canada, Liechtenstein, Marshall Islands, Romania, Iran, Poland, Sweden, Luxemburg, France, Azerbaijan, Greece, North Cyprus, the USA and Spain.

* Trade volume (TRY) of foreign institutional investors based on country of residence excluding Turkey between January 1, 2015 and September 30, 2015.

Australia%2

S. Africa%1

Netherlands%28

UK%55

Ireland%1

Austria%1

Malta%11

16

TOP 10 BROKERS

By the end of Sep 2015, 66 members are active in trading every month

Rank MemberJan-Sep 2015

Trade Volume (TRY)Share (%)

1 TEB INVESTMENT SECURITIES 119,843,508,986 14.50

2 IS INVESTMENT 72,989,027,419 8.83

3 GARANTI INVESTMENT 71,808,235,759 8.69

4 SANKO SECURITIES 56,021,187,773 6.78

5 YAPI KREDI INVEST 42,370,897,796 5.13

6 YATIRIM FINANSMAN SECURITIES 32,336,114,030 3.91

7 GEDIK INVESTMENT 31,898,787,889 3.86

8 CREDIT SUISSE ISTANBUL SECURITIES 28,129,675,504 3.40

9 AK INVESTMENT 27,841,820,715 3.37

10 A1 CAPITAL SECURITIES 25,787,003,705 3.12

17

BIST 30 INDEX FUTURES

Underlying Asset BIST 30 Index

Price Quotation 1/1000 of the BIST 30 Index value

Contract Size BIST30 Index is divided by 10 TRY (i.e. TRY 9,757 - ~ USD 3,307)

Contract Months 3 nearest months in February, April, June, August, October cycle and December

Tick Size 25 Index Points

Value of Tick Size TRY 2.5 (USD 0.84) per contract

Last Trading Day Last business day of each contract month

Settlement Method Cash Settlement

Final Settlement Price 20% of closing price of BIST 30 Index and 80% of time weighted average (TWAP) of the last 30 minutes of the trading session of the underlying index

Trading Hours 09:10 - 17:45, session break at 12:30-13:55 Istanbul time (GMT+2)07:10 - 15:45 London time

CCP Takasbank

Settlement Period T+1

Margins Initial margin: 895 TRYMaintenance margin: 75% of the initial margin

18

USD/TRY FX FUTURES

Underlying Asset USD/TRY

Contract Size 1,000 USD

Contract Months The current month, the next calendar month, the next cycle month and December (Cycle months are February, April, June, August, October and December)

Tick Size 0.0001 TRY per USD increments

Value of Tick Size TRY 0.10 (USD 3.4 cents) per contract

Last Trading Day Last business day of each contract month

Settlement Method Cash Settlement

Final Settlement Price CBRT USD/TRY offer price fixing announced at 15:30 on the last trading day

Trading Hours 09:10 - 17:45 Istanbul time (GMT+2)07:10 - 15:45 London time

CCP Takasbank

Margins Initial margin: 145 TRYMaintenance margin: 75% of the initial margin

19

REVENUE SHARING MARKET MAKING PROGRAM

Zero exchange fee for market makers

50% of the total exhange revenue is shared with market makers

Free connectivity

No need to be a member in order to serve as a market maker

The program includes

Single Stock Futures & Options

BIST 30 Index & Mini BIST 30 Index Options

USD/TRY FX Options

Electricity Futures

Steel Scrap Futures

ETF Futures

Wheat Futures

20

PARTNERSHIP WITH LONDON STOCK EXCHANGE

Vendor Code

Reuters RIC Codes for Futures 0#BIST30II:

Reuters RIC Codes for Options 0#BIST30*.LL

Bloomberg (LSEDM BIST30 Index futures)

BFLA Index CT <GO>

Bloomberg (BIST National 30 Scaled for LSE Options)

XU030XF Index OMON <GO>

Borsa Istanbul signed a partnership agreement with London Stock Exchange (LSE)

BIST 30 Index futures and options are listed on LSE Derivatives Market

Trades to be cleared by LCH.Clearnet

Initial contract margin in USD/GBP/EUR

Variation margin and trading in Turkish Lira

21

PoP–LONDON EQUINIX LD5

Borsa Istanbul launched its Point of Presence (PoP) service to extend its market data infrastructure worldwide via London Equinix LD5

Borsa Istanbul PoP service offers

Access to real-time data of all Borsa Istanbul’s markets and of EDDN members

A secure Fiber Optic Network connectivity option to Borsa Istanbul, with a maximum delay of 50 msec (roundtrip max. 100 msec)

22

HOW TO TRADE AT ?

For membership local presence is required.

For VIOP Members list, http://www.borsaistanbul.com/en/members/members-list?y=21

0% Withholding tax for corporate investors*

Takasbank is the CCP for derivatives market VIOP

Portfolio based risk management with SPAN® algorithm

*Please get advice from your tax advisor

23

HOW TO REACH DATA ON BLOOMBERG?

Bloomberg

Index Futures-XU030 Index CT

Single Stock Futures-SFUT TI

FX Futures-A1A Curncy CT (A2A, B2A)

Gold Futures-XLA Comdty (XLTA)

Index Options-XU030X Index OMON

Single Stock Options-GARANTI Equity OMON,…

USD/TRY Options-TYX Curncy OMON

Steel Scrap Futures–SVOA Comdty

24

HOW TO REACH DATA ON REUTERS?

Reuters

All Futures-0#ISTFUT:

All Options-0#ISTOPT:

25

SOFTWARE DEVELOPERS AND DATA VENDORS

THANK YOU

/borsaistanbulEN /borsaistanbul /borsaistanbul

Muammer ÇAKIRHead of Derivatives Market Tel : +90 212 298 25 80Mob : +90 530 067 56 60muammer.cakir@borsaistanbul.com

Derivatives MarketTel : +90 212 298 24 27-3viop@borsaistanbul.com