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There is huge potential in Dubai's financial market, according to Alfred Tang, director of GFS Investments, one of the latest multinational firms to be given a licence to operate in DIFC.

A global leader in online foreign exchange trading, the firm whose parent company GFS Forex and Futures Inc is based in the US, allows traders from across the world to trade 24 hours a day online.

The company, which already has offices in the US and Hong Kong, now hopes to establish 500 client accounts within the next six months in the region.

And according to Tang, who visited Dubai from Hong Kong last month, the online trading market is set for unprecedented growth in the UAE.

Can you explain exactly what your company does?

We deal in contract currencies that are traded online.

The company speculates on the market by buying and selling currencies and clients exit the market by liquidating their position and then trying to realise the profit or loss.

It's actually similar to futures market trading.

It is all done online - but we also provide trading by telephone.

This is actually in case if the online internet connections fail so when online trading isn't available, we still have services here whereby customers can trade by telephone.

The standard currency contract is worth US$100,000. In order for clients to buy a contract, we have a margin system whereby you do not have to pay the full value of the contract. But you are paying a deposit, which is in the region of 1 to 2% of the total value of the contract.

Our parent company is in the US - we are registered in the US and regulated by the CFTC (commodities, future trading corporation).

And we are a member of the National Futures Association.

For GFS we have offices in the US, in San Francisco and Hong Kong and also this office in the UAE.

What are the strongest currencies you are dealing in at the moment?

We deal in contract currencies whereby instead of buying a physical currency, you buy a contract currency.

The contract is to buy some currency at a certain price then at a later date, you can sell the currency and you can realise the difference between the two prices. Actually you can buy the contract then sell it at any time, you can do it the same day or over the next three days or it can actually roll over indefinitely.

We are trading mainly in the major currencies, the British pound, the euro the Japanese yen, the Swiss franc and dollars.

Actually the market movement is not really concentrating on dollars at the moment.

How long have you been established with an office in the UAE?

Although our business was incorporated in the US in 2000 and registered in 2001, we have actually only been in business in the UAE for two months now.

We have to eventually move to DIFC but at the moment we are in offices in Deira because they do not have enough offices for members and we are on the waiting list.

How do you think the DIFC will boost investor confidence in the UAE?

DIFC is very well regulated and is regulated on the same lines as the financial authority in the UK.

Having this jurisdiction will definitely increase the investor confidence in the UAE. Especially investors in the Middle East.

In DIFC investors in the Middle East find they have a strong and confident financial authority and that will definitely encourage them to put their investments here.

What have you achieved so far in the UAE?

We are currently in the development stages of establishing a business in the UAE.

For the past two months we have been recruiting and training our staff including our customer service officers and our sales and marketing team.

We've also been making contact with potential introducing brokers.

This is a very important activity for us.

Introducing brokers are brokerage firms who introduce customers to us so they become our partner and part of our marketing arm.

We find this to be a winning situation because the introducing broker already has an infrastucture to do business and they might already have a customer base.

They will have a sales and marketing team already functioning.

They can put our product into their portfolio to offer to their existing clientele.

The clients will be happy because they have a better choice, and a longer list of products to choose from. The introducing brokers without much additional investment all of a sudden will have more products to offer which it turns means more business and more income.

And for us with minimum capital investment, opening up branches and so on, we will have an immediate, marketing arm to do the marketing for us.

I think this is a win win situation. All we have to do is provide a supporting service to them.

If we can do this well it will be a very cost effective way for all parties to conduct a business. And hopefully then we can transfer these cost savings to our customers.

What is your strategy for setting up and growing your business in the UAE?

We are dealing only with high net worth clients and corporations so we have a team to solicit introducing brokers who already have marketing experience and who have already a sales and marketing team. They see the potential of what we already have and can help us to grow our business.

What sorts of customers will you be targeting?

A lot of them are institutional investors. Some are private investors.

Our guidelines are to attract high net worth clients.

Before taking on new clients we do a very careful analysis of their background and their trading experience.

We have to conduct a KYC (know your customer) procedure which involves understanding the customer's background and their trading experience in the past.

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