Futures trading beckons at local brokers as GBOT partners GSE, CAL Brokers
Individuals, institutions and the corporate community in Ghana will have the opportunity to trade in currencies, commodities and equities from the comfort of their homes or offices when the multi-asset electronic exchange becomes operational by the close of the year.
Developed and operated by the Mauritius-based Global Board of Trade Ltd (GBOT), the exchange provides opportunities for ‘futures’ and ‘options’ trading in currencies and commodities. It will later add individual equities and indices.
In ‘futures’ trading, quoted prices (contracts) become effective at later dates, say, a month or two and thus thrives on careful analysis, expectations and future events. Due to its peculiar nature, companies, individuals and nations are able to use it as a risk management tool for currencies and commodities.
“This is a risk management product so people can use it to hedge. The investment products on the exchange also make it ideal for short-term trading to improve liquidity,” the Managing Director and Chief Executive Officer of GBOT, Mr Rinsy Ansalam, told the GRAPHIC BUSINESS in Accra.
Currently, the exchange is trading in gold, silver, copper, nickel, aluminium and zinc as well as crude oil (WTI) and coal.
Commodities listed on the exchange include maize, wheat, potato and rice, but Mr Ansalam told the GRAPHIC BUSINESS that since African countries such as Ghana, Nigeria and Kenya would be hooked live onto the exchange, it would also list commodities such as cocoa, cotton and coffee for the futures contract.
The Ghana cedi, the Naira, Kenyan shilling, the South African Rand, the Egyptian Pound and the Mauritian rupee are listed alongside international currencies on the exchange.
GBOT has already signed a memorandum of understanding with the Ghana Stock Exchange to place the exchange. Efforts are ongoing to retrofit the GSE onto the international web-based platform and when this happens it will enable traders to access it electronically globally.
GBOT is collaborating with CAL Bank to launch the internet-based exchange in Ghana, which will be the first live exchange in Africa, outside of Mauritius. The launch will enable clients of CAL Brokers to access the exchange from the comfort of their homes and offices.
Already, the GBOT trades US$50 million a day, but it is targeting between US$5 billion and US$8 billion a day trading after its African expansion, Mr Ansalam said. From Ghana, the target is US$250 million trading a day.
The local representative of GBOT, Mr Maxwell Gidi, told the GRAPHIC BUSINESS that his outfit was bringing the entire financial system on board, as it would serve as a risk and investment management tool for the sector.
“We are sensitising and training all treasurers of banks and financial institutions as well as brokers on the importance and how to use the platform. We want everybody to come on board,” he said.
He said there was already a growing number of traders from Ghana who were making thousands of dollars a month trading from their homes and offices, on smartphones, tablets or personal computers.
The management of GBO explained that their aim was for African countries and corporate Africa to take full advantage of the platform and ensure a “better integration of African markets”.
Mr Mr Ansalam added that the platform would “help African stock exchanges to develop further as they make their products more visible across the world through the exchange.”
By Samuel Doe Ablordeppey/Graphic Business/Ghana
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