NCDEX launches Gold Futures Contract

Author: Paul Ploumis
21 May 2015 Last updated at 07:53:12 GMT
NEW DELHI (Scrap Monster): India’s National Commodity and Derivatives Exchange (NCDEX) today announced the launch of Gold Futures Contract, which is expected to bring more transparency and credibility into gold pricing in the country. The new Gold Futures Contract will be available for trade from May 21st (ie., today).

According to NCDEX press release, it has introduced a gold premium polling mechanism by an independent agency. The final settlement price of the gold futures contract will be arrived at by using the polled unbiased price benchmark. The mechanism enables consumers, jewellers, traders, banks and gold refiners to derive the final wholesale price through precise assessment of daily gold premiums in the physical market.

NCDEX will determine the daily premium or discount based on an independent, unbiased survey banks, traders and gold dealers in various cities across the country. The polled premium will connect the gold price in dollars per troy ounce with the wholesale value of kilobars in domestic Indian market. The calculated premium or discount will reflect the logistical cost and market fundamentals specific to India.

"With the new gold futures contract, we hope to bring much-needed clarity into the way gold is priced in the country,” said Samir Shah, MD and CEO, NCDEX. He further stated that the exchange will continue its efforts to boost information transparency in commodity markets by introducing highly innovative methods.

NCDEX is an online commodity exchange based in India. It provides commodity exchange platform for market participants to trade in commodity derivatives. It is the country’s only commodity exchange promoted by national institutions. NCEDX is regulated by the Forward Markets Commission (FMC).