Pakistan Mercantile Exchange Limited (PMEX) is Pakistan's first and only multi-commodity futures exchange, which is licensed and regulated by the Securities and Exchange Commission of Pakistan (SECP). Shareholders of PMEX include National Bank of Pakistan (NBP), Pakistan Stock Exchange Limited (PSX), ISE Towers REIT Management Company Limited, LSE Financial Services Limited, Pak Brunei Investment Company Limited, Zarai Taraqiati Bank Limited and Pak Kuwait Investment Company Limited. The Exchange offers a diverse range of domestic and international commodities and financial futures.
With a sophisticated infrastructure based on state-of-the-art technology, PMEX provides a complete suite of services ie trading, clearing and settlement, custody as well as back office, all under one roof. The Exchange has a member base of 333 and the average daily trading volume is PKR 5.5 billion. PMEX's international affiliations include Memberships of Association of Futures Markets (AFM) & Futures Industry Association (FIA) and Memorandum of Understanding (MoUs) with Borsa Istanbul, Izmir Commodity Exchange, Dubai Gold & Commodity Exchange, Iran Mercantile Exchange and Dalian Commodity Exchange.
PRODUCT SUITE
The Exchange endeavors to offer products that cater to the needs of all types of market participants such as investors who invest in commodities for long term, traders who work with the aim of earning profit based on their market strategy and hedgers who trade to mitigate their risk, using commodity futures market.
Against this backdrop, in the last 10 years PMEX broadened its product range by launching a rich mix of products to further enhance its product portfolio. This has not only helped the brokers to attract new business but also provided portfolio diversification opportunities to market participants.
At present, the Exchange offers 28 commodities with 43 contracts of different denominations which can be clubbed into four main asset classes: metal, agriculture, energy and financial futures. Namely, these are: Gold, Oil (Brent & WTI), Silver, Copper, Platinum, Natural Gas, FX Pairs, International Equity Indices, Red Chilli, Paddy Rice and Wheat.
TECHNOLOGY INFRASTRUCTURE
As technology continues to evolve every year, the Exchange relentlessly endeavors to modernize its technology infrastructure to meet and stay ahead of the demands created by the changing trends. In this regard, to provide a upgraded trading experience to the market participants, the Exchange has initiated an overhaul of its technology infrastructure which includes, migration of the core architecture to Cloud Computing, introduction of a brand new back end system and a globally renowned front end trading platform.
The Exchange has successfully migrated its core technology architecture to cloud computing, providing a faster and efficient trading experience for the market participants in line with global standards. Moreover, PMEX has provided MetaTrader 5, globally acclaimed front end trading system, to all its market participants. Now all PMEX members are being benefited from advanced features of MetaTrader 5 and offering efficient trading and investment facilities to their clients. The cutting-edge functionality of the popular platform is now available to Pakistani traders, including trading through the desktop application, mobile applications for iOS and Android based devices and the full-featured web platform.
Going forward PMEX will soon introduce state-of-the-art back end trading system. The Exchange is confident that the technology overhaul will provide a faster and more efficient trading experience for market participants in line with global standards.
ENTERPRISE RISK MANAGEMENT FRAMEWORK
Risk management is one of the key business drivers of organizations the world over. An enterprise-wide approach to risk management enables an organization to assess the potential impact of all types of risks on organization wide processes, activities, stakeholders, products and services.
The Exchange operates in an environment of ongoing uncertainties related to geo-politics and global economies. It is therefore empirical to take a macro view at an enterprise level to develop a robust risk framework which would enable the Exchange to be pro-active towards risk identification and management. Keeping the above in perspective, the Exchange in FY 206-17 developed an Enterprise Risk Management (ERM) framework to identify, assess and manage key risks across the organization to facilitate the organization to attain its strategic & business objectives. PMEX believes that a successful ERM initiative can deliver benefits related to better informed strategic decisions and increased operational efficiency. Going forward, the management intends to attain risk management certifications in line with international best practices.