HANDBOOK FOR THE DERIVATIVES MARKET Bolsa de Santiago February of 2020 Index 1. Applications of this Handbook ............................................................................................ 6 1.1. What is Bolsa de Santiago and CCLV’s Derivatives Market? .................................................... 6 1.2. Information in this Handbook ..................................................................................................... 6 2. Overview .......................................................................................................................................... 7 2.1. Statutory Regulations ................................................................................................................. 7 2.2. Tax Framework .......................................................................................................................... 9 2.3. International Investors ................................................................................................................ 9 2.4. Institutional Regulations ........................................................................................................... 11 2.5. Bolsa de Comercio’s Position .................................................................................................. 12 2.6. CCLV’s Position ....................................................................................................................... 13 2.7. Operating Model ...................................................................................................................... 14 3. Participants .................................................................................................................................... 16 3.1. Operation Requirements .......................................................................................................... 16 3.1.1. Brokers .................................................................................................................................. 16 3.1.2. Banks and Institutional Investors .......................................................................................... 18 3.1.3. Private Investors ................................................................................................................... 20 4. Products of the Derivatives Market ................................................................................................ 21 4.1 Products of the Futures Market ................................................................................................. 21 4.1.1 Equities .................................................................................................................................. 21 4.1.2. SP IPSA ................................................................................................................................ 22 4.1.2. Currencies ............................................................................................................................. 24 4.2.1.2 Observed Dollar .................................................................................................................. 24 4.1.3. Fixed Income ........................................................................................................................ 25 4.2 Products of the Options Market ................................................................................................ 28 4.2.1 Specifications of Stock Options Contracts ............................................................................. 28 Underlying Asset ............................................................................................................................. 28 Mnemonic Code .............................................................................................................................. 28 Style of the options contract ............................................................................................................ 29 Expiration dates .............................................................................................................................. 29 Lot size of the options contract ....................................................................................................... 29 Settlement method of the stock options contract ............................................................................ 29 2 Strike price ...................................................................................................................................... 30 Settlement price .............................................................................................................................. 30 Types of options contracts .............................................................................................................. 30 4.2.2 Specifications of options contract on the United States dollar (USD) .................................... 30 Underlying Asset ............................................................................................................................. 30 Mnemonic Code .............................................................................................................................. 30 Style of the options contract ............................................................................................................ 31 Expiration dates .............................................................................................................................. 31 Lot size of the options contract ....................................................................................................... 31 Settlement method of the dollar options contract ............................................................................ 31 Strike price ...................................................................................................................................... 32 Settlement price .............................................................................................................................. 32 Types of options contracts .............................................................................................................. 32 4.2.3 Specifications of options contracts on the SP IPSA index ..................................................... 32 Underlying Asset ............................................................................................................................. 32 Mnemonic code ............................................................................................................................... 32 Style of options contract .................................................................................................................. 33 Expiration dates .............................................................................................................................. 33 Lot size of the options contract ....................................................................................................... 34 Settlement method of the options contract ..................................................................................... 34 Strike price ...................................................................................................................................... 34 Settlement price .............................................................................................................................. 34 Type of options contract .................................................................................................................. 34 5. Negotiation ..................................................................................................................................... 35 5.1. Routing of Orders ..................................................................................................................... 35 5.2. Negotiation System .................................................................................................................. 36 5.2.1. Negotiation Platform ............................................................................................................. 36 5.2.2. Negotiation in the Derivatives Market ................................................................................... 37 5.2.3. Derivatives Market Portfolios ................................................................................................ 38 5.2.4. Negotiation Flow ................................................................................................................... 40 6. Information Systems ...................................................................................................................... 42 6.1. Main query modules for Information related to negotiations .................................................... 42 3 6.1.1 Query modules for daily information ...................................................................................... 43 6.1.1.1 Query modules for the Derivatives Market (futures y options) ............................................ 43 6.1.1.2 Query modules for the Futures market ............................................................................... 45 6.1.1.3. Query modules for options contracts ................................................................................. 46 6.1.2. Query Modules for Historical Information .............................................................................. 47 6.1.2.1