DUBAI: The Dubai Gold and Commodities Exchange (DGCX) posted strong growth in precious metals, currencies and energy last year. It also diversified its portfolio by introducing innovative products into the Middle Eastern market.
The exchange recorded 26 per cent year-on-year growth with 1.14 million contracts, valued at $57.5 billion, traded last year. Average daily volume touched just over 4,500 contracts last year, an increase of 28pc compared with 2007. Since inception in November 2005, over 2.6m contracts have been traded with a value in excess of $107bn.
Last year, DGCX took steps not only to expand its portfolio, but also to review existing contracts as per the requirements of members.
At the DGCX annual general meeting, held in Dubai last month, DGCX chairman Ahmed bin Sulayem outlined the exchange's objectives and growth plans to expand the exchange further this year. He said that the core strength of DGCX lies in its understanding of customers' needs and its positioning as the exchange offering "the right products, in the right place and at the right time".
In May, the launch of West Texas Intermediate and Brent crude oil futures surpassed all previous DGCX product opening day volumes.
In the month following the launch of crude oil futures, 36,500 contracts worth $4.9bn were transacted, making the crude oil launch the most successful ever for DGCX.
In October, the Indian rupee futures contract was strengthened to reflect market developments and customer requests.
The contract, which is now cash settled in US dollars, remains the only Indian rupee futures contracts accessible to international market participants.
July last year was the best month at DGCX since the exchange opened for trading in 2005, with 187,000 contracts worth $12bn and a new daily record of over 14,000 contracts.
The increase in activity was led by trading in futures on crude oil, currencies and precious metals.
DGCX chief executive officer Malcolm Wall Morris said that volatile global markets and the tightening of credit have clearly altered the economic framework in which DGCX operates.
"However, at the same time, the economic crisis has demonstrated the importance of transacting derivatives business via an exchange and clearing house in order to reduce counterparty credit risk. DGCX is uniquely positioned to meet this requirement by operating the Middle East's sole clearing house," he said.