Gold options by MCX to come into play in September

In order to provide even smaller players in the bullion industry with an instrument to hedge their risk, Multi-Commodity Exchange (MCX) will establish the first-of-its-kind gold options contract in September. In June, the Securities and Exchange Board of India (SEBI) allowed hedge funds registered as Category III Alternative Investment Funds (AIFs) to invest in commodity derivatives as clients, thus opening the market to institutional investors for the first time.
 
Gold options and hedge funds will increase the exchange’s turnover in the next fiscal year. Incidentally, India is the world’s second-biggest buyer of gold with imports of around 800 tons a year. Meanwhile, reporting its income for Q1FY18 on a YoY basis, MCX stated that it had decreased 7.1% to Rs 87.24 crore.