According to the definition given in Article 142 of the Civil Code of the Russian Federation:
“Security is a document, issued with all mandatory details present and in compliance with the established form, certifying property rights,
the exercise or transfer of which is possible only upon presentation.”
So, the Russian law states that securities are documents (could be traditional paper documents or e-documents) certifying property rights, therefore valuation of a security means
appraisal of the property rights that this document provides to its owner.
Depending on the type of property rights guaranteed, all securities can be divided into two main categories:
According to the established financial practice and Russian law, securities can be issued by different entities:
Securities on the Russian financial market are mainly represented by stock, bonds, promissory notes and shares in investment funds. With these types of securities two main tasks
of financing the economy are solved: attracting investment capital and attracting borrowed funds.
Futures, options and other derivatives are not very widely used in Russian financial system.
Many situations related to the legal circulation of securities require an independent and professional valuation of securities.
For example, Russian law requires mandatory independent valuation in some particular situations such as:
In some other situations independent valuation of securities, though not required by law, is performed based on client’s requirement to have an independent professional opinion
on the value of the subject securities when:
Over the course of more than 20 years of doing business as independent valuers in Russia we have accumulated extensive knowledge in valuation of virtually all types of securities.
According to our experience, securities the most often clients require valuation of are shares and promissory notes. For more details on valuation procedure, please visit the corresponding sections:
Valuation of Stock
Valuation of Promissory Notes
For more information on our services regarding securities valuation in Russia, please contact us.
According to our practice of valuing securities, the market value is determined in most cases. The market value of a security is the most probable price at which it can be sold
on the open and competitive market.
The market value of a security should not be confused with its nominal (face) value - these are completely different things. The security’s nominal value is either the total amount of the obligation
for debt securities, or initial value of a share in company’s capital stock set by the issuing company, while the market value is basically a current price of the security on financial market.
The nominal and market values of the same security may differ dramatically.
When using a valuation report on securities it is highly advisable to look at what type of value was determined and as of what date. The value determined in the report may quickly
become outdated and may not reflect the current situation on financial market, where the value of the securities can change very quickly.