How did foreign institutional participation impact derivatives trading?

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Foreign Institutional Participation Drove Record Derivatives Trading Volume

Foreign institutional participation played a significant role in driving the record trading volume for Bursa Malaysia Derivatives in 2022. These institutions accounted for 50 per cent of the total trading volume, marking a substantial increase. This heightened engagement underscores global confidence in crude palm oil futures (FCPO) as a vital tool for managing risk during periods of market instability.
Increased Share in Trading Volume

In 2022, foreign institutions constituted half of the overall trading volume recorded on Bursa Malaysia Derivatives. This level of participation represents a significant increase, demonstrating a growing reliance on the exchange's products by international investors.
Substantial Growth in Participation

The participation of foreign institutions saw a notable surge of 27 per cent from 2021 to 2022. This substantial growth directly contributed to the exchange achieving an all-time high in yearly trading volume across all its products.
Confidence in Risk Management Tool

The strong growth in foreign institutional involvement reflects a continued confidence from the global trading community. Specifically, it highlights the perception of FCPO as an effective instrument for hedging and managing risks, particularly amidst volatile market conditions.

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How did foreign institutional participation impact derivatives trading?

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