Arun Jaitley emphasised that the government is taking efforts to formalise gold trade
Finance Minister Arun Jaitley Tuesday launched gold options trading on the leading commodity bourse MCX and said this is one of the steps towards formalising trade in the yellow metal.
Options are derivatives which give a buyer the right but not the obligation to buy or sell an underlying asset or instrument at a specific price on or before a certain date.
"This marks a very important evolution in trading of yellow metal itself. It hedges all risks by giving them (traders) the option of futures," Mr Jaitley said after launching the options trade on the auspicious day of Dhanteras Tuesday.
Indians are great buyers of gold. This new product will be extremely successful, he said.
Emphasising that the government is taking efforts to formalise gold trade, Mr Jaitley said, "I am sure more it formalises, better it is for consumers, jewellers and those trading in this. That's in consonance with the business environment for future that we see for us".
This is the first product for options trading that the regulator Sebi has allowed after 14 years of commencement of commodity exchanges in the country, he added.
The gold options contract launched Tuesday allows trading in 1kg gold. Finance Secretary Ashok Lavasa, Economic Advisor to PM Bibek Debroy, MCX chairman Saurabh Chandra and MCX managing director and CEO Mrugank Paranjape were present at the event.
MCX is the leading commodity bourse in the country with a market share of over 90 per cent. It has a large presence in gold, base metals, and energy. (Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)