The growth came as more and more institutional and retail investors turned towards commodity markets, NCEL said in a press release on Monday.
The addition of commodities to the investment portfolio offers an opportunity for diversification as well as hedge against inflation and the slow pace of the equities market. As more and more investors recognise the importance of commodities trading, the numbers keep multiplying, NCEL said.
While main focus still remained on gold trading, volumes have also picked up significantly in silver and crude oil contracts. Gold trading has shown a marked increase from about 87,000 contracts in 2009 to around 642,000 contracts in 2010.
This rise was on the back of increasing gold prices in the year and more reliability of the precious metal as a safe investment with comparatively less volatility than equities.
During the year, NCEL also introduced new contracts of one tola (11.7 grams) gold and of crude oil and silver. Another addition was the launch of a gold fund with KASB Funds, which is the first of its kind in Pakistan. MD and CEO NCEL, Samir Ahmed, said that the commodity exchange had surpassed combined trading volumes of Lahore and Islamabad stock exchanges, an achievement made in a short time.
NCEL is the country’s first demutualised electronic futures exchange with a 100 per cent institutional shareholding and is licensed and regulated by the Securities and Exchange Commission of Pakistan.
Published in The Express Tribune, January 11th, 2011.
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