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More derivatives planned to entice gold investors in India

Section: Daily Dispatches

Options on Gold Futures May Be Launched in August

By Ram Sahgal
The Times of India, Mumbai
Friday, June 23, 2017

Traders of equity options will soon get a new product to punt or hedge on -- options on gold futures. MCX, the country's largest commodity derivatives exchange, could introduce the options by August, two persons familiar with the development said. One of them said the chief draw for equity option players would be the cheaper cost to trade.

The cost to trade one lot (1 kilo) of gold futures at Ruprees 28.6 lakh was Rupees 1.43 lakh, or around 5 percent intraday on Thursday. An option contract will be available at just a fifth of that, or Rupees 29,000, one of the persons said. The gold futures contract is costlier than trading even one lot of Titan futures at Rupeess 1.25 lakh intraday on Thursday.

Gold options "would be a draw for those who want to take exposure to commodity futures and options at a cheaper cost," the other person said. ...

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