The leverage position at the Karachi Stock Exchange (KSE) was at comfortable side compared with a couple of years'''' average, despite the fact that the index has reached an all-time high level.
During last week, the derivatives market was in the limelight as two major CFS scrips--D G Khan Cement and National Bank of Pakistan--were traded at spot, before their book closures. Therefore, small investors leveraged themselves through futures counter. The rate of return at futures counter was 16.7 percent, 292 basis points down from previous week.
Average daily volume at future counter was 131 million shares (Rs 27 billion or $455 million) as compared to 103 million shares (Rs 18.9 billion or $317 million) of previous Friday.
At KSE, CFS investment stood at Rs 25.4 billion at the end of the week, compared to Rs 23.9 billion of previous Friday, while financing rates remained at a level close to cap, that is 17.9 percent.
According to a report by Jahangir Siddiqui Capital Market, this made the total leverage position( of Rs 45.2 billion) 1.3 percent of the market capitalisation, or 6.6 percent of free float. "This ratio is still on comfortable side, if we compare it with last two years'''' average, which is two percent of market capitalisation and 10 percent of free float.
At LSE, Badla investment stood at Rs 0.74 billion at the weekend, up by 16 percent, whereas the badla rate remained flat at 15.7 percent.