June 2006 - Market activity report

The Exchange continued achieving newer feats during the month. In merely seven months of its inception, DGCX extended it product portfolio further with the introduction of Foreign Currency future contracts on 12th June 2006.

With this, DGCX offers an ideal platform to trade currency and precious metals on a single exchange. Currency future contracts introduced include Euro/US Dollar, Yen/US Dollar and Sterling/US Dollar contracts. Each of these currencies have four forward months contracts maturing in March, June, September and December spanning over a complete year. The contract size for Euro/USD and Sterling/USD is 50,000 Euros and pounds sterling respectively while the contract size for Yen/USD is 5,000,000 yens.

In view of the sudden sell-off in the global commodity markets recently, prices fell sharply across the board. The market players seemed to have taken a cautious approach thereafter. The value of gold futures traded on the exchange since its inception crossed 200,000 contracts mark and $4 billion (in value terms) during the month.

Total open interest in respect of gold futures i.e. the number of contracts executed (bought or sold) but not closed out by the participants, as on June 30, 2006 stood at 639 contracts valued at $12.61 million. In respect of silver futures, the open interest at the month-end was 131 contracts valued at $1.45 million.

A smaller average intra-day volatility of $14.26 / troy oz was observed during the month in the gold prices for the near-term maturity contract as compared to that of $19.27 / troy oz seen during May 2006. Following the volatility trend in gold prices, the intra-day volatility in respect of Silver July 2006 expiry contract was also at a lower end - nearly 33 cents compared to that of 64 cents witnessed during the month of May 2006.

The exchange conducted two investor seminars on May 18 and June 8 respectively for common investors' education and spreading awareness about the futures market. These were met with an overwhelming response.