Precious Metal Derivatives - Canada

Canada

The nominal value in the Precious Metal Derivatives market is projected to reach €217.70bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 5.85% resulting in a projected total amount of €289.30bn by 2029.
The average price per contract in the Precious Metal Derivatives market amounts to €0.08 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (€11,060.00bn in 2024).
In the Precious Metal Derivatives market, the number of contracts is expected to amount to 3.05m by 2029.

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Analyst Opinion

The Precious Metal Derivatives market in Canada is experiencing significant growth and evolution in response to changing customer preferences and local special circumstances.

Customer preferences: Investors in Canada are increasingly turning to Precious Metal Derivatives as a way to diversify their portfolios and hedge against market volatility. The appeal of these financial instruments lies in their ability to offer exposure to the price movements of precious metals without the need for physical ownership.

Trends in the market: One key trend in the Canadian Precious Metal Derivatives market is the growing popularity of gold and silver derivatives. As safe-haven assets, gold and silver have traditionally been sought after during times of economic uncertainty, driving up demand for related derivatives. Additionally, the introduction of innovative derivative products, such as options and futures contracts, is further fueling market activity and attracting a wider range of investors.

Local special circumstances: Canada's strong mining industry and significant reserves of precious metals play a role in shaping the Precious Metal Derivatives market in the country. The presence of major mining companies and the country's reputation as a leading producer of gold and silver contribute to the market's depth and liquidity. This unique local context provides investors with confidence in the stability and reliability of Precious Metal Derivatives linked to Canadian assets.

Underlying macroeconomic factors: The performance of the Canadian economy, global geopolitical events, and fluctuations in currency exchange rates all influence the Precious Metal Derivatives market in Canada. Economic indicators, such as interest rates and inflation, play a crucial role in shaping investor sentiment and driving demand for these financial instruments. Moreover, regulatory developments and government policies impact the overall landscape of the derivatives market, creating both challenges and opportunities for market participants.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.