July 06, 2017 01:30:31 PM
SEATTLE (Scrap Monster): The Dubai Gold and Commodities Exchange (DGCX) has recorded strong growth in trading volumes of Gold and Currency contracts amid rising geopolitical risks and economic uncertainty across the globe. The newly listed diversified futures trading strategies attracted tremendous investor interest. According to DGCX press release, traders have benefited from the difference in movement between near term and longer term future contracts with the recent introduction of ‘Calendar Spreads’. The trading volumes of G6 Currency contracts surged higher significantly during June this year, it noted.
The DGCX Precious Metals portfolio continued to demonstrate strong performance during the initial six-month period of 2017. The trading volumes of Spot Gold and Shanghai Gold Futures touched record highs during the month of June. The monthly trading volumes and Average Open Interest (AOI) recorded their highest level during the month. The Spot Gold trading volumes totaled 4,702 contracts, whereas Shanghai Gold Futures’ volumes crept up to 3,433 contracts. Meantime, trading volume of G6 currency contracts rose sharply during the month with Canadian Dollar Contracts recording 815% jump in volumes. The Swiss France and Japanese Yen too recorded 692% and 313% jump in volumes when compared with the same month in 2016.
It must be noted that Spot Gold Futures volume had recorded an impressive 1131% growth from previous year during May this year. The volume of Shanghai Gold Futures had totaled 2,889 contracts in May 2017.
The exchange’s robust performance during H1 2017 is attributed to geopolitical developments across the globe and various products and initiatives rolled out by the exchange during the first half of the year, said Gaurang Desai, CEO of DGCX. US President Donald Trump’s new policy initiatives, the UK elections amid Brexit negotiations and geopolitical developments in other parts of the world including North Korea and Qatar led to increased investor interest in DGCX products as best tools to manage their risk.
In addition, the various initiatives launched during the first half of 2017 have started bearing fruit. The exchange had successfully launched new Chinese gold derivative product and had migrated to an enhanced risk management framework. Moreover, the exchange had been successful in expanding its footprints by partnering with various local banks and other international exchanges. The recent addition of calendar spreads on key products has immensely contributed to the exchange’s growth.
The initiatives undertaken during the first half of the year were valuable and have helped in adding more depth and confidence to marketplace, Desai noted. The exchange will continue its efforts in tapping similar opportunities during the second half of the year. The focus will be on initiatives to foster the growth of exchange by offering new and innovative products to market participants, he said.
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.