DGCXs January open interest up 26%

Thursday, Feb 04, 2016

Dubai: The Dubai Gold & Commodities Exchange (DGCX) said it has recorded a strong start to 2016 with January figures showing an Open Interest increase of 26 per cent during the same period last year.

January numbers reflect the increasing use of derivatives to hedge foreign exchange (FX) volatility particularly in emerging market currencies such as the Indian Rupee and South African Rand. Market participants appreciated the cost effective investment mechanism provided by Indian Rupee Options. Rupee Options volumes grew by 352 per cent in January 2016 vs. January 2015.

“Against the backdrop of global economic turmoil and a volatility across market segments, investors and corporates need to be aware of the important role derivatives futures exchanges such as DGCX play as a regulated platform to hedging their risk and optimally manage their balance sheets. With crude oil prices falling below $30 per barrel in January, it is becoming increasingly important for economies, particularly oil reliant ones, to look at ways of hedging their risk and managing their fiscal deficits,” Gaurang Desai, CEO of DGCX, said in a statement.

The recently launched Dubai Spot Gold Contract traded 1516 kgs in January 2016, the DCCC has also facilitated delivery of 73 kgs of physical gold till date. Jewellers and other bullion participants have started to utilise Dubai Spot Gold to lock-in the price and manage physical supply chain needs using the unique rollover mechanism. Flight to safety also saw the India Gold contract volume double during January 2016.

On January 15, DGCX launched its equity product segment by offering 15 Single Stock futures on blue chip USA stocks like Facebook, Google, Apple, JP Morgan and Microsoft. 10 Indian stocks were part of this launch and included Axis Bank, Tata Motors, TCS, Infosys, Reliance, HDFC Bank, SBI, ICICI, L&T and Maruti Suzuki.

Staff Report