Transaction charges set to be waived for commodity derivatives
The BSE is launching trading in commodity derivatives on October 1 and has decided to waive transaction charges for the first year of commodities market operations, the exchange said on Friday.
However, the National Stock Exchange (NSE), the largest exchange by volumes, said it would launch trading on October 12, that is after pitru paksha, considered inauspicious.
The NSE will begin with trading in gold, silver and even mini-gold, which can attract small investors.
The BSE will begin trading in commodity derivatives with gold (1 kg), silver (30 kg) contracts, and later add energy products, metals and agri commodities.
In what is seen as a big challenge to the MCX, a market leader in non-agri commodities derivatives, the BSE has decided to waive transaction charges for the first year of commodities market operations.
“The BSE firmly believes that its commodity derivatives platform will help in efficient price discovery, reduction in timelines, cost-effective, user-friendly, robust risk management system and wider market penetration,” the BSE statement said.
Ashishkumar Chauhan, managing director and chief executive officer, BSE, said: “We believe the BSE’s foray into commodities derivatives on October 1 will enable many more participants to join the commodities market and enhance the linkages between underlying spot markets and commodity derivatives markets in each commodity the BSE introduces in this market.”
The NSE said in a statement it had received approval for launching the commodity derivatives segment from the Securities and Exchange Board of India.
Apart from gold and silver the bourse will launch trading in mini-gold (100 gram) contracts. The spokesperson for the NSE said: “We have received representations from trading/clearing members, suggesting that some more time be given to market intermediaries to put in place appropriate systems at their end for effective trading of commodity derivatives.”
The NSE will begin with trading in gold, silver and mini-gold, which can attract small investors. It will launch trading on October 12, after the inauspicious pitru paksha