By IZZAT RATNA / Pic By MUHD AMIN NAHARUL

Kenanga Futures Sdn Bhd hopes the volatility in the markets and asset classes will attract more locals to trade in derivatives which offer opportunities within a stable and controlled environment.

Kenanga Futures CEO and head of listed derivatives Azila Abdul Aziz (picture) said the broker’s move to offer access to contracts traded on the CME Group and Bursa Malaysia Derivatives Bhd (BMD) exchanges would allow traders to have the opportunity to hedge or speculate on a host of contracts.

Traders can now access both the US- and Malaysian- listed derivatives on Kenanga Futures’ TradeActive trading platform, which is available both on desktop and mobile devices.

Azila said Kenanga Futures is targeting to diversify its portfolio mix by leveraging on more outbound traders compared to before.

“It is kind of premature for me to forecast our trading volume aim right now, but it’s only natural we diversify from 100% inbound to maybe 5% to 10% outbound.

“Outbound business has always been our core strength, so we are a firm believer that we have to be strong in Malaysia as a domestic features broker, faci l itat ing foreign inflows,” she added.

Azila said the broker hopes access to BMD and CME Group markets and contracts over the mobile application will capture a new audience, grow its customer base and help build a smart derivatives trading community in Malaysia.

Kenanga Futures’ TradeActive facilitates both inbound and outbound business models with the capabilities of system integration among a multitude of financial information exchange protocolcompliant platforms.

She said price discovery on the derivatives market could provide traders with a three-, six- and nine-month projection as well as a three-year forecast.

“The volatility would attract risk management and interest for people to protect the underlying physical exposure,” she added.

Azila said more measures are needed to raise awareness among investors and traders for the local derivatives market to transition into a mainstream-trading channel.

“For starters, we have a domestic network, which has yet to be trading more in derivatives because they are familiar with stocks and bonds because the dynamics are totally different.

“We need to start engaging customers who are already trading on BMD to begin trading in contracts on the CME via the TradeActive,” she said.

Azila added that constant education and engagement with corporations, such as refiners of palm oil and biodiesel players, is crucial to motivate them to enter the derivatives market as a hedge against price volatilities.

“You cannot control price volatility as there are so many factors affecting it. So, as investors, the derivatives market is the right trading platform to avoid massive risks amid various uncertainties in the market today,” she added.