DGCX shrugs of Brexit

Volumes on the Dubai Gold and Commodities Exchange (DGCX) crossed over 11 million contracts this year, growing 49 per cent from last year.

The overall volumes in July 2016 touched 1,674,268 contracts, registering a massive year-on-year (yoy) increase of 47 per cent, driven largely by elevated trade volumes across precious metals, currencies, equities and hydrocarbon segments.

The Exchange also recorded the highest monthly overall Average Open Interest (OI) of 257,249 contracts in July 2016.

July 26, 2016, a key date in the history of DGCX, saw the Exchange hitting its highest ever daily volume with 176,645 contracts valued at $3.6 billion,  and recording the highest daily OI of 381,456 contracts valued at $6.5 billion.

DGCX’s precious metals segment, particularly the gold products, continued with its high volume growth owing to uncertainty and volatile markets post Brexit.

The Exchange’s flagship gold futures contract traded an average of 2,155 contracts per day in July, registering a substantial yoy increase of 61 per cent. While Average Daily Volumes (ADV) on Gold Quanto touched 1,389 contracts in July 2016, recording an impressive Y-O-Y growth of 170 per cent. DGCX’s gold portfolio locked in a strong performance this year, trading 456,913 contracts, up 99 per cent from the same period last year.

In DGCX’s currency segment, Indian Rupee contracts witnessed brisk trading, recording the highest monthly Average OI of 144,184  contracts in July 2016. Monthly Average Daily Volume (ADV) on the Indian Rupee Quanto contract registered a yoy growth of 351 per cent.  Indian Rupee options registered a Year-to-Date (YTD) increase of 150 per cent. ADV on Rupee futures grew by 27 per cent, trading 45,842 contracts in July 2016. British Pound futures continued to see heightened trading activity in July driven by the Brexit uncertainty, with ADV growing 279 per cent from the same period last year.

Gaurang Desai, CEO of the Dubai Gold and Commodities Exchange said: “We are pleased to set a number of records this month specially on the Open interest front, which reflect the sustainable confidence on the DGCX platform. Open Interest is an indication of the resident interest and liquidity, and also demonstrates the robustness of our trading platform. We offer a diversified range of products which enable markets participants to effectively manage their risk and exposure across different asset classes, especially with the global uncertainty more prevalent over Brexit.”

The Hydrocarbon asset class also reported a favorable growth in July on the back of sliding oil prices, registering an increase of 185 per cent from the same period last year.

New product performance

The newly-launched Dubai India Crude Oil (DICO) contract traded 1,823 contracts since its listing on July 1 2016. The product designed to bring together the DGCX WTI prices and the flagship USDINR contract, has been witnessing significant interest from market participants.

The contract which was launched as part of the Exchange’s efforts to strategically strengthen its energy vertical, allows participants to trade in a crude oil futures benchmark referencing the Indian Rupee, whilst trading in US dollars. With WTI pricing accounting for over 25 per cent of global supply, the DICO futures contract provides accessibility to the Indian energy markets for a wider range of participants.