Wednesday, May 14, 2008

MCX Is Planning To Open Additional Delivery For Precious Metal

New Delhi: Encouraged by the good response to its Gold Guinea futures contract, leading commodity exchange MCX is planning to open additional delivery centres to facilitate delivery of the precious metal.

"We are planning to have more delivery centers soon," an MCX official said, adding it becomes convenient for players who would like to take the delivery.

Currently, the contract has opened delivery centres at Ahmedabad, Delhi, Mumbai, Hyderabad, Bangalore, Chennai and Kolkata. The delivery centres become important in a mini contract especially when the contract has compulsory delivery norm, an expert said .

'Gold Guinea' futures contract, which can be traded in eight-gram unit, was launched on the MCX on May 8, on the Hindu festival of 'Akshaya Tritiya.' It has received huge response from the participants, the exchange official said.

"This is for the first time a commodity exchange in the country launched a contract that caters to even smallest of retailers. The unit size at 8 gm is quite convenient to trade especially for the retailers who cannot afford to trade in contracts of bigger size," an analyst said.

The Guinea contract has offered the competitive price as compared to physical market where guinea is being sold at 12-14 per cent higher than futures prices.

At 1600 hours today the gold guinea July contract was traded at Rs 9,729 per 8 gram, while that of August delivery at Rs 9,748.

On the first day of the launch, the turnover of both the July and August contracts in terms of volume recorded 181 kg and in terms of value it was Rs 21.5 crore and with open interest on May 9 standing at around 1500 guineas.

However, the average daily volume is 100-120 kg as open interest reached at 13 kg till date, sources said.

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