By Anil Mathews
ABU DHABI (Scrap Monster): The Dubai Gold and Commodities Exchange (DGCX) has been named the ‘Regional Exchange of the Year 2016’ by Global Investor magazine. The announcement to this effect was made on October 26, 2016. The award is in recognition of the ongoing efforts by the Exchange to deliver innovative, safe and regulated products for traders in the region.
The average daily volume of the Exchange was 71,870 contracts, valued at around US$ 1.60 billion during the month of October. The average Open Interest (OI) position recorded phenomenal growth over the previous year to total 460,155 lots valuing at an average of $7.61 billion.
In currency segment, the Indian Rupee product suite contracts hit new record. The cumulative Average Daily Volume (ADV) growth recorded 37% jump and were valued at $1.48 billion. The traded volumes of the Indian Rupee Options, Quanto and Rupee-USD Futures contracts surged to 14.9 million contracts till date in 2016. The year-to-date ADV of the Indian Rupee Options contract witnessed jump of 219%. The year-on-year volumes of the Rupee Quanto contract skyrocketed by almost 300% to 4.23 million traded contracts. The Indian Rupee options volumes surged higher by 157% year-on-year to 249,717 contracts. The monthly Average Open Interest (AOI) of Indian Rupee Options contract hit new high of 16,196 contracts, whereas the AOI of Indian Rupee Quanto Futures contract hit peak of 238,783 contracts.
As an attempt to augment its client base and ensure increased participation by members, DGCX had recently welcomed ABN AMRO Clearing Bank N.V. as a Special Clearing Member on Dubai Commodities Clearing Corporation (DCCC). According to market participants, the appointment of the global leader in clearing and post-trade services is aimed at expanding and deepening access to the Exchange’s diverse product range. Incidentally, DGCX is the only Exchange in the region to offer local clearing house facilities, acting as both seller and buyer, thereby guaranteeing settlement.
The Exchange had recently obtained license from the Shanghai Gold Exchange (SGE) to list Shanghai Gold Futures on its exchange, thereby becoming the first international exchange to list the Shanghai Gold Futures contract. This is the first yuan-denominated gold future product to be offered outside of China. According to Exchange authorities, the product will use the Shanghai Gold Benchmark Price as its pricing mechanism. The license agreement signed between DGCX and the SGE is expected to foster economic cooperation between China and Dubai, they hoped.
In addition to opening vital trading link to Chinese bullion market, the DGCX had recently appointed Bank of China (BOC), as a Settlement Bank for DCCC. The addition has raised the total number of settlement banks to five, the other settlement banks being Emirates NBD, Standard Chartered, HSBC and Bank of Baroda. The appointment is also expected to significantly accelerate the interaction and collaboration between the derivatives and financial markets of both the countries. In addition, investors in both the countries will now be offered more diversified product portfolio to trade with.
DGCX is a subsidiary of Dubai Multi Commodities Centre (DMCC), a strategic initiative of the Government of Dubai, with a mandate to enhance commodity trade flows through the Emirate by providing the appropriate physical, market, financial infrastructure and services required. The Management team of DGCX comprises senior personnel from the commodities, securities and financial services industries bringing a wealth of experience and expertise to ensure the success of the exchange.