DGCX March 2006 - Market activity report

Another highlight of the month was that silver futures contracts started trading on DGCX on March 28, 2006. On the very first day itself, 1158 contracts equivalent to approximately 34750 kgs (valued at USD 12.70 million) of silver futures were traded.

March was the second consecutive month in a row where the Exchange volumes zoomed up by more than 150%. A total of 43945 contracts of gold and silver futures were traded as against 16,421 contracts in February 2006. Correspondingly, average number of contracts traded per day also increased from 821 in February 2006 to 1910 in March 2006.

In value terms, $733.05 million of gold futures were traded in March 2006 as compared to $293.36 million in February 2006 - an increase of 150%. The total value of gold futures traded on DGCX since inception (November 22, 2005) now stands at $1.25 billion (70,471 kilograms of gold futures contracts).

As in other international markets, the near month contract maturing in April 2006 was traded most heavily. 31,572 April 2006 contracts were traded in March as against 14,199 in February, a jump of 122 %. With the April 2006 contract entering into the delivery period, the interest of market participants shifted towards the June 2006 expiry contract.

Total open interest for gold futures - the number of contracts executed (bought or sold) but not closed out by the participants, as on March 31, 2006 stood at 734 contracts valued at $13.78 million.

Gold prices recorded a new 25-year high while silver futures made a memorable debut on DGCX by trading at a new 22-year high. Gold prices at DGCX, witnessed a roller coaster ride mirroring the trend in international markets. DGCX futures for April 2006 expiry opened at $ 563 / T. Oz on March 1, 2006 and receded down to touch a low of $547.20 on March 13. After moving sideways for a couple of days, gold prices bounced back to close at a historic 25-year high of $585.70 on March 30. Prices eased on March 31 to end the month a tad lower at $581.60 T. Oz.

A lower average intra day volatility of $7.93 was observed in the gold prices in March 2006 as compared to $9.21 during February 2006.

The DGCX July 2006 silver contract opened at $10.950/ troy oz. and scaled a high of $12.020/ troy oz. before finishing the week at $11.600/ troy oz. A total of 3052 contracts were traded during the week and the open interest stood at a very healthy 432 at the close of the week.

Number of members connected to the DGCX trading platform increased from 65 on February 28, 2006 to 85 on March 31, 2006, reflecting the confidence of the market in the 4 month new exchange.