Pakistan’s commodity exchange the Pakistan Mercantile Exchange achieved the highest-ever monthly trading volume of Rs129 ($1.3 billion) billion in the month of August 2012 with a total of 325,000 contracts.

This is a record increase crossing the previous high June 2012 of Rs119 billion. Discussing the achievement, Samir Ahmed, managing director of PMEX said: “This volume record is a testament to the fact that the market continues to grow at a fast pace. It also gives us the assurance that an increasing number of Pakistani investors are accepting commodities as an alternative asset class for portfolio diversification.”

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The Pakistani rupee is trading at 94.75 against the greenback.

Volumes at PMEX have since 2011 continued to exceed the combined trading volumes for all three stock exchanges. For the latest three month period, June to August, total PMEX volumes were Rs352 billion compared to Rs214 billion for the stock exchanges.

Furthermore, PMEX is showing continuous improvement and diversification in its product mix. Mansoor Ali, chief business officer at PMEX commented: “Our product mix has been growing for quite some time now as investors become aware of and familiar with different products”.

“While gold has been the dominant product since the initial days, improvement in crude oil trading has been witnessed as it took a market share of 39 percent in the overall product mix of PMEX increasing from Rs8.2 billion in August 2011 to Rs47 billion in August 2012,” he said.

This reinforces the view that investors are trading crude oil as an instrument for hedging their fuel bills. PMEX will continue to follow the tight risk management procedures and controls that it has pioneered in Pakistan and that have stood it in good stead, especially in recent times of immense volatility in the international markets.

Forex Magnates team wrote a detailed report on the FX market in Pakistan, CMC Markets had a major IB based in Karachi called Harvest Topworth. Due to banking restrictions local brokers were forced to migrate to Dubai where major volumes are traded. The report is available in the Q1 quarterly report.

Rahat Mansoor owner of Abacus Trading operates as a broker dealer, he says “the Pakistani market is one of the largest and oldest in Asia, i first started trading in the early 2000 when e-trading first started, if the FX market gets regulated we will see record trading in Pakistan”.