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“Currency Trading Opportunities at DGCX”

“Currency Trading Opportunities at DGCX”. About DGCX. Region’s 1 st and largest derivatives exchange Commenced trading in November 2005 Since launch over 6.8 million contracts traded with a value in excess of US $323 billion

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“Currency Trading Opportunities at DGCX”

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  1. “Currency Trading Opportunities at DGCX”

  2. About DGCX • Region’s 1st and largest derivatives exchange • Commenced trading in November 2005 • Since launch over 6.8 million contracts traded with a value in excess of US $323 billion • 48% year-on-year growth (2006/07); 26% year-on-year growth (2007/08); 32% year-on-year growth (2008/09); 28% year-on-year growth (2009/10), 41% YTD • Operates the region’s sole commodity derivatives clearing house, Dubai Commodities Clearing Corporation (DCCC) • 230 members and 86 clearing members. • Regulated by the Emirates Securities & Commodities Authority (ESCA)

  3. The DGCX Advantage • Key economic indicators all available on one single Exchange in the Middle East (Metals, currencies and energy.) • Business transacted and cleared in the UAE and so funds remain in the region – offering the benefits of local taxation and regulation • Low transaction fee structure - one fee for all participants • All participants pay the same margin, whether commercial or non-commercial

  4. Product Portfolio • FX: • INR/USD Futures • EUR/USD Futures • GBP/USD Futures • JPY/USD Futures • AUD/USD Futures • CAD/USD Futures • CHF/USD Futures • Metals: • Gold Futures • Gold Options on Futures • Silver Futures • Steel Rebar Futures • Energy: • WTI Crude Oil Futures • Brent Crude Oil Futures • Fujairah Fuel Oil Futures

  5. Year on Year Volume Growth

  6. The global FX market has grown significantly in recent years to reach an estimated daily turnover of US $4 trillion, a 20% growth on 2007 volumes Growth is driven by greater activity of more sophisticated traders (algorithmic, HFT), and expansion of private investor participation The growth in FX trading, coupled with the need to manage counterparty and operational risk, offers vast opportunities for DGCX, its members and the FX trading community Volatility has encouraged market participants to use futures contracts for both investment and to manage price risk DGCX has seen 50% growth in currency futures volume year to date. The Global FX Market

  7. Indian Rupee Futures a particular success story New daily record: 12,499 contracts, US $551.55 mn

  8. Market Participation on DGCX • 80% of our volumes originate from members based within the region • 20% of our volumes originate from Europe, the US and East Asia • A range of market players participate in DGCX markets: • Commercial institutions • Funds and asset managers • Arbitrageurs • High New Worth Individuals • Proprietary Traders • Private investors

  9. Market Access and Clearing • Clearing (DCCC): • Real-time position monitoring • Well funded Settlement Guarantee Fund (SGF) • Zero defaults since inception • Capital efficient margin levels • Access to DGCX markets for trading: • Via a Broker Member (orders can be placed over phone via member or on-screen via a Trader Workstation) • Direct access as a member using DGCX own front end • Direct access as a member using own or vendor software on FIX Protocol • Access to DGCX Prices: • Via a work station; a member; a quote vendor or the DGCX website (15 minute delayed)

  10. Membership Structure • DGCX membership is open to corporations or partnerships • Members typically located in the UAE; can be located outside from some jurisdicstions Broker Membership: • Broker Members are entitled to trade on all the products listed by DGCX either on a proprietary basis or on behalf of clients Trade Membership: • Trade Members are entitled to trade on a proprietary basis only for all products listed on DGCX Introducing Broker Membership: • An Introducing Broker Membership entitles the applicant (Introducing Broker) to introduce clients to Broker Members for transacting business on DGCX • Please note that an Introducing Broker is not permitted to handle Client’s funds/securities

  11. Benefits of Trading DGCX Currency Futures Contracts • Ideal location and trading hours which cross over between time zones of Europe & Asia • Essential mechanism for managing price risk i.e. Hedging, for example to FX rate exposure or to protect gold inventories • Arbitrage trading opportunities with other international markets • DGCX futures contracts are cleared via Dubai Commodity Clearing Corporation (DCCC), removing counterparty credit risk and providing guaranteed settlement to each transaction

  12. Summary • DGCX is well established with a strong membership base and growing volumes • Wholly owned Clearing House – settlement and funds remain in tax free environment of UAE • Robust product portfolio and strong product pipeline • Distinct competitor advantages and trading opportunities • Significant potential to grow contracts further by accessing regional liquidity pools in Middle East and Asia

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