MCX launches Gold Petal Futures Trading in One Gram Gold Contract
Multi Commodity Exchange of India Ltd (MCX) launched a one gram gold contract April 18 called Gold Petal futures contract. Currently, Gold Petal May and June 2011 contracts have been offered for trading.
The trading unit of the gold contract is one gram and price quote for the contract is ex-Mumbai (inclusive of all taxes and levies relating to import duty, customs duty but excluding Sales Tax / VAT, any other additional tax or surcharge on sales tax, local taxes and octroi). The delivery of contract is possible in dematerialised or physical form. The physical delivery would be available in multiples of eight gram coins with London Bullion Manufacturers Association (LBMA) certified 999 purity. The delivery centers identified are G4 Securitas at Mumbai, and other delivery centers at New Delhi, Ahmedabad, Hyderabad, Bangalore, Chennai and Kolkata.
Tick size of the contract is Re 1/- per gram and the maximum order size is 10 Kg. The initial margin required to trade will be 4% or based on SPAN, whichever is higher. The open position limit for members has been fixed at 12.5 MT for all gold contracts combined together or 15% of the open market position, whichever is higher, and for clients it is 2.5 MT of all gold contracts combined together.
Mr. Lamon Rutten, MD & CEO, MCX said: “Gold is considered as an investment option, and has now become a part of portfolio of many investors and hedge funds. Availability of Gold Petal, a product that can act as a SIP product, will attract the retail participants.”
MCX has developed different contract denominations to accommodate the needs of varied market participants. Apart from Gold Petal, the other gold contracts that the exchange offers are Gold (1 Kg), Gold Mini (100 grams) and Gold Guinea (8 grams).