MCX Launches Options Contracts On Bullion Index Amid Gold, Silver Lure
The bullion index, covering both gold and silver, offers a balanced exposure in the bullion segment to market participants, MCX said.
The Multi Commodity Exchange of India Ltd. on Monday launched monthly options contracts on the MCX iCOMDEX Bullion Index amid a frenzy in precious metals. The MCX BULLDEX constitutes the popular and liquid MCX Gold and Silver Futures contracts.
"The options contracts on this index will empower market participants with a versatile risk management tool, combining the benefits of diversified underlying assets with the flexibility of Options trading," the bourse said in a statement.
The bullion index, covering both gold and silver, offers a balanced exposure in the bullion segment to market participants – both investors and institutions alike, conveniently and cost-effectively, that would meet both their investment and hedging requirements, MCX said.
Monthly index contracts will have a maximum of three-month trading cycle — the near month, mid-month and far month. On expiry of the near-month contract, the new contracts are introduced for a three-month duration.
A derivative contract shall have a value of not less than Rs 5 lakh at the time of its introduction in the market, as per MCX.
Earlier this month, MCX raised the margins on both gold and silver contracts by 1% and 1.5%, respectively, to manage risks.
MCX has a market share of about 98% in terms of the value of commodity futures contracts traded in the financial year 2024-25.
The MCX Bullion Index has given an annualised return of 12.4% over five years, as per the latest available data from the exchange.
The company will announce its second-quarter earnings on Nov. 6.
