Dubai arcade 'to double volumes'

TRADING GROWTH: Dubai PTG have plans to double its trading despite global turmoil.

Dubai Professional Trading Group, the Middle East's first trading arcade, said on Wednesday it plans to double its derivative volumes traded on international exchanges despite global financial market turmoil.
 
The arcade, which opened its doors in October, trades more than one million commodities and financial contracts per month, making it the most active derivative trading centre in the region.
 
"Crossing the one-million mark is a sign that there is a growing interest in derivatives and in trading them through an arcade," Benedict Floyd, executive director of Dubai PTG told Reuters in an interview.
 
"We're on track to double the number of traders in the arcade and the volume of contracts, mainly fixed income and commodities, they execute," he said.

The Dubai arcade houses 10 independent traders. It plans to bring in 50 more traders by the end of 2009, Floyd said.
 
A trading arcade or boutique is a space where independent traders rent a desk and a screen to trade a financial market of their choice, often derivatives, at cheaper trading fees.
 
Despite a nearly year-old credit crisis, which threatens to send the U.S economy into a recession, commodities and foreign exchange markets are booming as investors look to them as a way of driving returns.
 
Analysts say the Middle East is seeing a growing appetite for derivatives, but still lacks traders with the in-demand skills. They say the market needs a new wave of highly numerate, young and analytical "e-traders" who understand risk management.
 
The Middle East's only commodities derivatives exchanges are Dubai Gold and Commodities Exchange (DGCX) and Dubai Mercantile Exchange (DME), but volumes have been modest so far.
 
"Despite the relatively modest volumes of trade in the region and the global credit crunch, we had no problem in attracting traders," Floyd said.
 
"The market here needs trained professional traders, and we have a long list of interested applicants who -- once trained -- will help boost the liquidity on local exchanges," he said.
 
Trading arcades became popular in the late 1990s when global bourses, faced with on-line exchange competition amid increasingly global trading, were forced to change the way they have traded for over a century.
 
In an electronic world, traders in arcades play the role of liquidity providers, jumping in and out of the market to grease the wheels of trading.
 
Dubai PTG offers new traders classroom training and access to performance coaches and risk managers.
 
The arcade also provides classes on technical analysis and market economics before allowing students to trade their own accounts. (Reuters)

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