Investor Appetite For DGCX Currency Products Continues to Grow Ahead of Launch of FX Rolling Futures Contracts
The Dubai Gold and Commodities Exchange (DGCX) continues to see strong investor appetite for its currencies portfolio against a backdrop of ongoing foreign exchange (FX) volatility. In June, the DGCX’s G6 currencies portfolio recorded year-on-year (Y-O-Y) volume growth of 265.56%, and has now recorded year-to-date (Y-T-D) volume growth of 456.69% compared to the same period last year. British Pound and Yen Futures Contracts were the most notable performers, registering Y-O-Y Average Daily Volume (ADV) growth of 307.58% and 1010.45% respectively.
The strong performance of the DGCX’s suite of currency products comes ahead of the launch of three FX Rolling Futures Contracts, which will provide investors with additional opportunities to efficiently hedge their risk exposure, particularly during this period of heightened volatility. The three FX Rolling Futures contracts – Euro (EUR), Pound Sterling (GBP) and Australian Dollar (AUD) against the US Dollar (USD) – will go live on Monday 6 July, 2020.
Les Male, CEO of DGCX, said: “The FX market across the region has been gathering pace in recent years, but it’s really come to the fore over the last few months in terms of investor appetite and maturity. This is particularly true in the UAE, which serves as a regional hub for retail and institutional traders and has solid regulatory infrastructure in place. Right now, the biggest factor influencing currency flows is of course the Pandemic and the uncertainty it’s caused globally, but we’re also seeing a number of other geopolitical events having a significant impact on currencies ranging from Brexit trade negotiations to concerns that the US and China trade talks may fall through again.”
Following the DGCX’s launch of three FX Rolling Futures Contracts next week, the DGCX plans to expand its portfolio of Indian Rupee (INR) Futures Contracts with the introduction of a Weekly INR Futures Contract against the US dollar (USD) later this month. The new contract will provide market participants with short-term hedging and arbitrage opportunities and will track the world’s largest pool of offshore liquidity for exchange-traded INR-USD currency products that the DGCX offers.
“The DGCX continues to play a pioneering role in the development of MENA’s financial markets. Dubai’s strategic geographic location between the Far East and Europe allows us to serve as a unique hub for global Forex flows. With the launch of these new products, we hope to further enhance the UAE and wider region’s rapidly growing influence and importance in the global FX market,” Male added.
Total volumes on the DGCX in June totaled 948,377, valued at USD 23.96 billion. The DGCX last month also recorded Average Open Interest (AOI) of 145,493 contracts.
About DGCX: Established in 2005, DGCX is the region’s leading derivatives exchange and the only one allowing global participants to trade, clear and settle transactions within the Gulf region. The Exchange has played a pioneering role in developing the regional market for derivatives and financial infrastructure. DGCX is an electronic commodity and currency derivatives exchange with over 148 members from across the globe, offering futures and options contracts covering the precious metals, energy, equities and currency sectors. DGCX is a subsidiary of DMCC (Dubai Multi Commodities Centre), a Dubai Government Authority for trade, enterprise and commodities. For more information: www.dgcx.ae
DGCX also owns and operates the region’s largest and only multi-asset Clearing House – Dubai Commodities Clearing Corporation (DCCC). DCCC is federally regulated by the Securities & Commodities Authority (SCA) and is recognized as a Third-Country CCP by European Securities Markets Authority (ESMA) with over 50 clearers from across the globe. For more information: www.dccc.co.ae
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