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Friday, 20th February 2004 (8933 views)

A gold exchange could soon be opened in Dubai, following the announcement of the first Arab diamond exchange, as part of the UAE's free zone for gold, metals and commodities.<BR/><BR/>Set to open by April this year, the new diamond exchange is being opened in a bid to maintain international standards within Dubai's diamond trade, according to Neftegaz News.<BR/><BR/>According to the Dubai Metals and Commodities Centre (DMCC), the exchange will be followed by other exchanges for gold, as well as aluminium, sugar and tea.<BR/><BR/>The DMCC aims to attract half of the global gold trade and was set up in April 2002, providing a 100 per cent foreign ownership and tax exemption for 50 years.<BR/><BR/>Under gold dealing, gold options allow holders the right to buy or sell a specific quantity of gold at a previously arranged price by a set date, but without the holder obliged to do so.<BR/><BR/>Prices are dependant on a number of issues, such as the current spot price of gold, interest rates, the level of the pre-arranged price, the amount of time left until the agreed date and the predicted volatility of the gold price.<BR/><BR/>There are a number of other exchanges dealing in gold, the biggest of these being the New York Mercantile Exchange Comex Division and the Tokyo Commodity Exchange.

 

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