NCDEX Launches “Gold Now” – Forward contract in Gold

NCDEX Gold Now-Forward contract in goldNCDEX Launches “Gold Now” – Forward contract in Gold

National Commodity & Derivates Exchange (NCDEX) has launched gold now platform yesterday (Thursday). This is online forward trading platform which facilities buying and selling gold. This new product was launched after 1 year of exhaustive planning at NCDEX exchange. What is Gold Now Forward contract all about? What are the features of NCDEX Gold Now forward contract platform?


Also Read: Should you invest in Gold Mutual Funds or Gold ETF's?

Features of NCDEX “Gold Now” forward contract

  • This platform, proposed to allow delivery of gold originated from domestic refineries through recycling.
  • Gold Now Platform offers gold forward contracts in the denomination of 100 grams to 1 KG.
  • Contracts with T+1 and T+2 settlement trading.
  • Forward contracts are issued for 6 delivery centres, Ahmedabad, Mumbai, Delhi, Cochin, Hyderabad and Chennai. Currently, the contract has Delhi as delivery center, with the exchange adding one center every week.
  • Approved 4 domestic refineries for delivery of gold on its Gold Now platform.
  • An online market for buying and selling gold forward contracts conveniently.
  • It would be complement to gold monetization scheme and Make in India campaigns launched by the Govt. of India.

Who would supply gold for NCDEX?

NCDEX has tied up with 4 refinery centres like MMTC PAMP, Kundan Group, Shirpur Gold refineries and Edelweiss for  forward contracts of gold.

After a year long exhaustive and meticulous process designed and conducted by 3 leading  international experts of reputed companies, exchange has approved 4 domestic refineries as gold delivery on gold now platform.

What does NCDEX Say about Gold Now, forward contract Platform?

Samir Shah, managing director and chief executive officer, NCDEX said,

"With the launch of the 'Gold Now' national marketplace, we are creating an ecosystem that is at par with international standards and which will help the bullion and jewelry industry improve its efficiencies,".

About a week ago, NCDEX had introduced gold premium polling mechanism for arriving at the settlement price of its gold futures contract.

NCDEX will also launch forward contracts within six months for gold coins in 5 gm, 10 gm and 50 gm denominations to be traded on the platform.

If mobilized effectively, this could create a domestic supply of gold, while reducing dependence on imports, in line with the government's proposed Gold Monetization Scheme.

Conclusion: After NSEL scam, I do not know how far investors/jewelers would accept such forward contracts platform in gold. We need to wait and watch the response from the market.

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NCDEX Launches “Gold Now” – Forward contract in Gold

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