InvestorQ : Do you see the options on gold and silver introduced by the NSE and BSE making a difference to volumes?
Crowny Pinto made post

Do you see the options on gold and silver introduced by the NSE and BSE making a difference to volumes?

Answer
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4 months ago


This is the latest attempt by the NSE and the BSE to improve their market share in commodities. Both the NSE and BSE will launch options on underlying commodities like gold Mini (NSE & BSE) and silver kilo (BSE) in June. NSE will also offer market making on its gold mini contracts under the liquidity enhancement scheme (LES). Both the NSE and BSE have been looking for a strong narrative to compete with MCX on commodities and this appears to be the latest narrative. Currently, MCX dominates commodity derivatives on precious metals, industrial metals and energy while NCDEX dominates the commodity derivative on agri segment. In the overall market, MCX has 94% market share, NCDEX has 5% market share while the NSE, BSE and IEX jointly have 1% market share. MCX is offering options on gold and silver futures but what NSE and BSE are proposing to launch is options on spot gold. This will be the first time that an exchange will offer options on physical gold.