By Anil Mathews
March 07, 2017 10:30:59 AM
ABU DHABI (Scrap Monster): The daily traded volumes on Dubai Gold & Commodities Exchange (DGCX) continued to rise during the month of February this year. Indian products, particularly the Indian Rupee Options Contract reported robust trading activity, mainly on the back of increased volatility in the Indian markets.
The monthly trading data released by DGCX indicates that average daily volumes (ADV) in the exchange’s product suite touched record highs of 62,844 contracts during the month. Indian Rupee Options contract recorded 92% jump in ADV. It also recorded the highest monthly Average Open Interest (OI) of 23,275 contracts. The Energy Products recorded a combined volume of 17,139 contracts, out of which Dubai India Crude Oil futures accounted for 5,980 contracts. This is the highest monthly volume for the product category since its introduction.
According to Gaurang Desai, CEO of DGCX, the spikes of trading activity witnessed in Indian referenced contracts highlight the importance of such products for hedging purposes during periods when financial markets experience sharp volatility. The proposals under the Indian Union Budget and the ongoing state assembly elections have stirred volatility in Indian markets, he added. Global market volatility is expected to trend higher through 2017, mainly on account of anticipated US Fed rate hike, uncertainty in policies by Trump administration and the upcoming European elections, Desai noted.
DGCX plans to push forward its agenda of offering diversified array of products and solutions to market participants help them effectively manage their risk and protect t hem from market fluctuations and economic uncertainty. Further, the exchange plans to list more Single Stock Futures as well as Energy products in the second quarter of 2017 which will attract more investors and increase participation on the Exchange’s trading platform.
After record-breaking 2016, the Dubai Gold and Commodities Exchange (DGCX) had recorded significant jump in trading volumes during the month of January this year, aided by the rising demand for safe-haven gold assets, amidst global volatility. The highest increase in volumes was recorded by the British Pound and Yen futures, which grew by 87% and 757% respectively. DGCX gold futures also reported 56% jump in volumes. The Indian Rupee Options contracts witnessed 176% year-on-year growth. Also, Quanto contracts grew by 127% over the previous year. The exchange’s Indian Single Stock futures recorded growth of 29% in comparison with the previous year. In addition, Chinese Yuan futures had recorded highest average OI of 436 contracts during January 2017.
It must be noted that the exchange had recorded 36% jump in volumes in 2016, registering its highest annual traded volume. The trade volumes aggregated at 19.7 million contracts valued at $439.5 billion. Also, average daily contract volumes had surged to 76,835 contracts, the highest ever in its eleven years of operation.
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.