Business Development

Executive

Training

HARVEST GLOBAL MARKETS

Welcome to
Information Empower
You And Gives You
Independence.
Introduction to the Financial Markets
Marketplace where buyers and sellers trade
financial assets.
Found in every nation in the world with the
largest and most famous being on Wall Street
in New York.
Mercantile Exchange is the market where
commodities are traded. It has an average daily
turnover of more than $3 trillion.
There is no central marketplace for commodity
exchange; trade is conducted over the counter.
Any person, firm or countrymay participate in
this market.
 Advantages of Commodity Trading

Liquidity
Price stability
Quick transactions
Instant withdrawal facility
Low transaction cost
24 hour market - Trade anytime
Hard to manipulate price
Trade from anywhere
Flexible margin facility
Ability to profit in bull or bear market
Gains from trading not taxed
 Property Local Stock Physical International
Market Market currency Market
market

Liquidity Low Moderate to low Moderate High

Availability of
buyers and sellers
Instant withdrawal
facility

Default Risk Low Moderate to Moderate to None

high high
Ease of transaction Low Moderate to low Moderate to low High
Initial Investment High Moderate to low Moderate to low Low
Required

Availability of No Minimal No Yes

margin
Storage costs High Medium Medium Low
Trading Hours Short Short Short 24 hours
Diversified Product No No No Yes
Range
 Pakistans mercantile exchange - PMEX

Institutional Share holders

Shareholders Shares (millions) %age
Pakistans first and only technology driven, demutualized, online
Commodities
NATIONAL future exchange.
BANK OF PAKISTAN (NBP) 47.40%
Regulated by The Securities Exchange 9.00
Commission of Pakistan (SECP)
KARACHI STOCK EXCHANGE (KSE)
3.64 19.20%
LAHORE STOCK EXCHANGE (LSE)
2.27 11.90%
ISLAMABAD STOCK EXCHANGE (ISE)
2.27 11.90%
PAK KUWAIT INVESTMENT COMPANY (PVT)
LTD. (PKIT) 0.91 4.80%

ZARAI TARAQIATI BANK LIMITED (ZTBL) 0.91 4.80%

100.00
%
Need for a Commodity Exchange
in
Fragmented Market
Pakistan
Inefficient costs added to value chain
Price discrepancy- between locations and
counterparties
Reneging on deals, frequent defaults of
payments and deliveries
Forward Hedging
Planning for future: To sow or not to sow,
Market Expectations
Inadequate Trade and Transaction Data
Moving away from just living in the present to
planning for the future
Commodity financing, Collateral Management,
Warehousing Receipts
 PMEX VISION
Bring International Markets to
domestic platform- Gold, silver, crude
oil, palm oli etc.

Make our domestic markets

international cotton, rice, wheat sugar
etc.
 HISTORY
Company formed in April 2002.
Management Appointed in Oct 2003.
Became Operational in May 2007 with
Gold Futures Contract.
First Physical Gold Delivery in Aug 2007.
Launched IRRI-6 Rice Futures in Mar 2008.
Launched Palm Olein Futures in Jun 2008.
Launched Kibor Futures in Jan 2009.
 HISTORY
Overtook ISE in terms of volumes in May
2009.
NBP became shareholder in Sep 2009.
Crude Oil and Silver Futures listed in
Nov 2009.
Overtook LSE in Apr 2010.
Linked with KATS (KARACHI-
AUTOMATED-TRADING SYSTEM ).
June 2010 - Second Biggest Exchange of
Pakistan in terms of
Traded Volumes.
Biggest Exchange in terms of
Membership.
 Benefits of Trading

on PMEX
Only recognised platform for
futures Trading under law.

Regulated by SECP.

No Credit Risk.

Segregation of Funds.

Minimal Margin
Requirements.

Direct Market Access /

Ease of Trading.

Guaranteed
Settlement.

T+0 Settlement.
How to start trading?
Step 1 Contact an PMEX Registered Broker
Step 2 Read and Sign Risk Disclosure
Documents
If required, ask for Direct Trading
Step 3 Terminal
Step 4 Broker Opens Trading Account

Step 5 Payment of Initial Margin to Broker

Insist on Account Statements from
Step 6
Broker
Step 7 Verify that Margins have been paid to
PMEX
Step 8 Ask for training, if using Direct Terminal
Step 9 Enter Orders, Monitor Position, Pay
Margins
Top Ten Brokers at PMEX, based on
Traded Contracts during the week
of Sept 21th Sept 25th2015

AFZAL KHALIQ
Notable Names Missing from the
Top Ten Brokers at PMEX List.

.
 What is the maximum risk
To my capital

Margin Trading

Risk Management

Volume Scalability

Stop Loss Strategy

Profit loss Ratio

 What is the minimum profit
I can earn monthly

Volume

Holding Period

Price Volatility

Discipline Trading

Trading Policy Model And The Religious

Practice On The Policy
 Advantages

Provision of Short-Selling
 GOLD 1 Troy Ounce
Trader A Trader B
Short Seller Purchaser

GO
LD
$1,250
1
GOLD Tro
y
1 Troy Ca
T + sh
Ou
nc
e
Profit
Ounce
$50
3
$1
,20
0 per Troy
Market
GOLD Ounce
1 Troy
Ounce

GOLD 1 Troy
Ounce
Broker Lender
GOLD 1 Troy
Ounce
 Advantages

Margin Trading
 Margin Trading :
Leveraging Big Benefits

In contrast to other investments, an investor

is only required to invest $3,000 to
hold/buy/sell about $100,000 worth of a
product

Here, $3,000 is referred to as MARGIN

The other $97,000 is known as
LEVERAGE
How Leverage Works
 Normal Deal

1. You have $3,000

2. You buy a box with that $3,000
3. You sell the box to someone else for $3,300, earning you
a $300 profit
 Deal Using Leverage

1. You have $3,000

2. You can borrow another $97,000, giving you $100,000 to
trade with...
3. You can now buy 33 of the same boxes
($100,000 / $3000 = 33 boxes)
 Deal Using Leverage

4. You now sell the 33 boxes for $3,300 each giving

you a total of $108,900 ($3,300 x 33 boxes =
$108,900)
5. You pay back the borrowed $97,000 and take out
$3000 you invested
6. You are left with $8,900, your profit ($108,900 -
$97,000 - $3,000 = $8,900)
 Normal vs Leveraged

Compare the two deals..

Leverage turns good deals into great deals

 Research
Fundamental Analysis
A method of evaluating Financial
Instrumentsthat entailsattempting to
measureits intrinsic value by examining
related economic, financial and other
qualitative and quantitative
factors.Fundamental analysts attempt to study
everything that can affect theinstrument's
value, including macroeconomic factors (like
the overall economy and industry
conditions)andcommodity specific factors. The
endgoal of performing fundamental analysisis
to produce a value that an investorcan
comparewith the instrument's current price,
with the aim of figuring out what sort of
V a l u e H a s A Va l u e
O n l y I f I t s Va l u e I s
Va l u e d .
Open House Session