Trade Volumes in Polish Stocks Increase, Derivatives Decline in May

Poland’s main stock exchange has reported promising volumes for the month of May. The Warsaw Stock Exchange (WSE) recorded PLN 17.4 billion (US $5.41) total equity turnover in May, an increase of 17.2% year on year. At the same time figures for derivatives instruments saw a decline month on month as Volatility puts traders back.

The volume of trading in all derivatives was 875 thousand instruments in May 2013, a decline of 10% MoM, figures for April were 972.1 thousand instruments. Its benchmark stock index contract saw a decline of 15% MoM.

Poland a new comer to the EU (2004) has been one of the best performing economies post 2008 crisis, in 2009 it was the only EU nation whose GDP increased. The EU’s sixth largest economy has benefited from being a large economy, population of 38 million, with quite substantial domestic demand.

Poland’s financial markets are one of the most advanced in the region, Warsaw has become a financial hub for domestic firms going for IPO.

Local Investors

Retail investors in Poland have benefited from numerous programmes by the local exchange in educating them about the nature of investment products. This has had a positive impact on investors who drive the local equities markets.

“The WSE have educated over two generations of traders. At the moment there is over 1.5 million retail account open – quite a high number. The number of accounts using derivatives is around 300 000, they already know how to trade, know the tools like technical analysis," explains Max Skolik, Head of FX at BRE Dom Inwestycyjny, a Polish bank offering FX and equities trading.

Poland witnessed a surge in banks offering FX platforms to retail and institutional investors in 2012, FX has been growing as an alternative investment product for traders in Poland, this has primarily been due to the weakness and declining volatility in domestic products.

Tomasz Maczka, Director of Sales at Noble Markets, a Polish broker states in a comment to Forex Magnates: “Individual investors in Poland are known for being rather active traders on Warsaw Stock Exchange. However during last 3-4 years due to lower volatility on stock exchange and bear market they became more interested in alternative investment opportunities with currency markets among them. Polish zloty has periods of big volatility against Euro, Dollar or Swiss franc, so big volatility shows traders that there is opportunity for trading.”

With the number of brokerages increasing and margin products becoming more mainstream, there has been an increase in investor participation in FX & CFD trading.

Artur Koziorowski, OTC Business Development Manager at Bank Zachodni WBK estimates there to be around 40,000 investors in the FX markets.