Stocks Observer. com

ISLAMABAD: Answering criticism in respect of approving trading of futures contract in cotton at the Pakistan Mercantile Exchange Limited (PMEX), the SECP has reiterated that the concerns raised in this regard are unsubstantiated. The SECP granted this approval after the PMEX had undertaken an extensive process of stakeholder consultation, which includes textile mills and cotton traders/brokers. Also, the said approval was granted by the SECP in accordance with its mandate to regulate matters relating to listed securities that include derivative products like futures contracts in commodities, under the 1969 Securities and Exchange Ordinance and the Securities and the 1997 Exchange Commission of Pakistan Act. It needs to be understood that ‘futures contracts’ based on commodities are derivative, trading in which is clearly distinct from ‘spot’ or ‘forward’ trading. The SECP does not regulate spot or forward tradi...