Precious Metal Derivatives - United Arab Emirates

United Arab Emirates

The nominal value in the Precious Metal Derivatives market is projected to reach €12.30bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 6.03% resulting in a projected total amount of €16.48bn by 2029.
The average price per contract in the Precious Metal Derivatives market amounts to €0.42 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 35.19k by 2029.

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Analyst Opinion

The Precious Metal Derivatives market in United Arab Emirates is experiencing a notable shift in recent years, reflecting changing customer preferences and local special circumstances.

Customer preferences: Investors in the United Arab Emirates are showing an increasing interest in diversifying their portfolios and hedging against market volatility through Precious Metal Derivatives. This trend is driven by a growing awareness of the benefits of including these financial instruments in investment strategies.

Trends in the market: One prominent trend in the UAE's Precious Metal Derivatives market is the rise of online trading platforms, making it easier for investors to access and trade these instruments. Additionally, there is a noticeable uptick in demand for derivatives linked to specific precious metals, such as gold and silver, as investors seek to capitalize on price movements in these commodities.

Local special circumstances: The UAE's status as a global financial hub and its favorable regulatory environment have contributed to the development of a robust Precious Metal Derivatives market. With a growing number of sophisticated investors in the region, there is a high demand for innovative derivative products tailored to their specific needs.

Underlying macroeconomic factors: The geopolitical stability and strong economic growth in the United Arab Emirates play a significant role in driving the demand for Precious Metal Derivatives. As investors look for safe-haven assets to protect their wealth, precious metals have become an attractive option, further fueling the growth of the derivatives market in the country.

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.