Trading in Dubai Gold Securities gathered pace in the three months ending 30 November 2009 with 53,190 shares traded during that period compared with a total of 27,691 shares in the first six months after its launch at the beginning of March 2009, representing an increase of 92%. Some 40,668 shares were traded in November alone with a total value of US$4.57 million.
A joint initiative of the World Gold Council and the Dubai Multi Commodity Centre (DMCC), Dubai Gold Securities trades on NASDAQ Dubai and is the Middle East’s first gold Exchange Traded Commodity (ETC). Additionally, it has been approved as Shariah compliant by an internationally recognized board of Shariah scholars.
Investors in the GCC region are increasingly seeking to obtain access to gold price performance by means other than the purchase of jewelry, said Grant Collins, Senior Managing Director, DCAM. “The introduction of Dubai Gold Securities has provided them with an efficient way to gain exposure to gold without incurring the costs associated with holding the physical metal. As a financial product that is designed to track the performance of the spot gold price, it fulfills the metal’s central role as a preserver of wealth, and does so in a manner that is Shariah compliant. The volume in November is indicative of a growing interest in and familiarity with Dubai Gold Securities and exchange traded financial products generally among GCC regional institutions and local investors.”
“DCAM has undertaken several initiatives this year aimed at informing market participants about the merits of gold ETCs, particularly as a hedging instrument against inflation and further weakness in the US dollar. And we anticipate continued interest in such products as long as those factors remain a concern for investors ,” he added.
Dubai Gold Securities LLP is incorporated in the Dubai International Financial Centre and can offer up to 1 billion Dubai Gold Securities under the Exempt Offer in accordance with the Offered Securities Rules of the Dubai Financial Services Authority. Dubai Gold Securities were first admitted to trading on NASDAQ Dubai on 2 March 2009.