Dubai Gold and Commodities Exchange (DGCX) – Everything You Need to Know
Dubai, throughout its history, has been an international hub for physical trade of gold and several other commodities. Thus, to ensure smooth trading, the region needed an organization that could manage local trade. This marked the birth of the Dubai Gold & Commodities Exchange (DGCX) in November 2005. It was started as the first commodity derivatives exchange in the region and now it is one of the leading derivatives exchange in the Middle East. The exchange is responsible for regulating gold prices in UAE and the prices of other commodities.
What is DGCX?
First of its kind in the MENA region, DGCX or Dubai Gold and Commodities Exchange is the subsidiary of Dubai Multi Commodities Centre (DMCC). It is a form of financial and commodities derivatives exchange that is responsible for providing appropriate services in respect to physical, financial and market infrastructure. It was established by the Government of Dubai, with a mandate to strengthen the city’s commodities and foreign exchange market. DGCX
The structure defined helps manage risk and diversify investment opportunities in the region.
The DGCX is regulated by the Securities and Commodities Authority in the UAE. It is managed by a team of senior personnel from the securities, commodities, and financial services industries.
What are the benefits of trading on DGCX?
Having a solid structure, DGCX offers numerous benefits to investors and its brokers. Some of the benefits that can be availed on commodity trading are:
Simple Fee Structure
No matter whether the entities are commercial or non-commercial, DGCX ensures that all of the investors and DGCX pay equal amounts and on the same level. To ensure this, DGCX has set a simple fee structure wherein investors and DGCX brokers in Dubai cover only one fee.
Trading on DGCX means that investors and DGCX brokers have an added advantage of guaranteed settlement in addition to reduced counterparty risks. This is backed by Dubai Commodities Clearing Corporation, a 100% subsidiary owned by the exchange.
Robust Risk Management and Surveillance Systems
With DGCX, traders can trade in both regional as well as international liquidity pools. For this, DGCX provides robust risk management and surveillance systems.
Uninterrupted Trading Hours
To ensure a smooth trading platform, DGCX offers uninterrupted trading hours from 07:00 to 23:55 hours Dubai time (GMT +4).
Trading through DGCX is a secure way to trade. The norms are regulated by the Securities & Commodities Authority (SCA).
DGCX and the International Gateway for Business- Dubai
Dubai is often referred to as an international gateway to trade, probably because of its prime location. Its time zone location between the Far East and Europe has allowed an extended trading time. In addition, the location also serves Dubai as the bridge between neighbouring markets. This makes it an attractive hub for the surrounding markets. And, the market here runs smoothly, is ensured by the DGCX.
In addition, investors and brokers in Dubai get a window to trade before it opens in South Asia. With this, DGCX investors and brokers in Dubai ahead of the momentum curve as compared to those in other markets.
Wrapping it Up
Dubai is always open to growth and development opportunities to become a world-class leader. This called for the need of DGCX so as to ensure the smooth flow of the global trading cycle. DGCX provides investors and brokers with a platform to offer contracts in various currencies and a variety of collaterals. And, at the same time, it also extends clearing house facilities to other exchanges and institutions in order to facilitate new revenue opportunities.