These MDEX contracts include the Crude Palm Oil Futures (FCPO) , KLSE Composite Index Futures (FKLI), three-month Kuala Lumpur Interbank Offered Rate (KLIBOR) interest rate Futures (FKB3) and Five-Year Malaysian Government Securities Futures (FMG5).
Meanwhile, the FCPO recorded the highest single-day record in 23 years of derivatives trading in Malaysia with 11,613 contracts traded on 16 January 2003. This record is equivalent to the notional amount of more than 290,000 metric tons of crude palm oil, being transacted on the same day. Open interest in the contract currently hovers near the 20,000 lots level.
Dr. Zaha Rina Zahari, Chief Operating Officer of MDEX said the record highs achieved by MDEX is a very positive indication that more investors are participating in derivatives trading in Malaysia.
"Derivatives provide expanded opportunities for risk management and hedging for market participants.
"The uses and benefits of participating in derivatives trading are applicable to a very wide range of the financial market segment including financial institutions, insurance companies, bond portfolio managers, provident funds, asset managers, corporate treasurers, or individual investors and MDEX local members," Zaha Rina added.
Zaha Rina said derivatives provide an effective and efficient tool for price risk management. "The uses and benefits of participating in derivatives trading are applicable to both the financial sector and the commodity markets.
"For our financial contracts, current market participants include the financial institutions, insurance companies, portfolio managers, provident funds and other funds. As for the FCPO, participants include the plantations, refineries, millers, dealers, merchants and end-users of the commodity.
"In addition, these markets also attract a large following from the general investing public as they also provide ample trading opportunities," Zaha Rina added.
