Gold is one of the hard commodities traded through MCX. MCX stands for the Multi Commodity Exchange. MCX is the exchange where you can trade commodities such as gold, silver and agricultural products like cotton, coffee, turmeric, etc., just like the BSE exchange where stocks of companies are traded. The trading mechanism done through MCX is pretty transparent, and it is disciplined with the regulatory framework.
Why should I Invest in Gold?
Gold is the oldest precious metal that's been traded by man and its global demand for gold is focused on four primary categories: jewellery, investment, central bank reserves, and technology. It is also valued as a global currency.
Reasons for Trading Gold:
Traders consider investing at least a small share of their assets in gold because Gold trading might provide portfolio protection in case of both geopolitical turbulence and economic catastrophes.
Investors who are not willing to invest in equity and bond markets but looking for ways to grow in emerging economies should consider gold.
However, investing in gold is not without risks. The gold price can head lower if the trader sentiment is gloomy.
There are situations which might lead to a decline in the gold price, such as financial aggressiveness from central banks and strength in US dollars.
And most importantly, if the market forecast is whimsical, it can alter the gold share price.
What are the factors influencing the market:
The gold market can be affected by various factors, and some main elements are,
Above ground supply of gold from central bank sales, reclaimed scrap and official gold loans.
Protection against volatility and uncertainty. In India, buying gold is considered to be a safe option when the other assets start losing their value.
In India, culture, tradition and seasons like harvesting influences, the demand for gold.
Macroeconomic factors such as Economic events, inflation rises and movements in dollar rate and interest plays a vital role in influencing the gold share price.
Geopolitical factors can influence the MCX gold rate. Gold usually performs well during the crisis, such as wars, while share prices typically have a negative impact. As buying gold is a perfect way to park funds, people consider it as a safe asset to invest.
Before trading in gold it’s always good to learn these contract specifications of gold:
The symbol used is GOLD, and the trading unit is 1kg.
The contract starts at 16th of a contract launch month and the last trading day falls on 5th of the contract expiry month. If both the days are holiday, then the preceding working day will be considered.
Trading is open from Monday through Friday and the trade hours are 10.00 a.m to 11.30 p.m/11.55 p.m
The maximum order size for trading is 10 kg, and the base value is 10 grams.
The initial margin is a minimum 4%, or sometimes it is based on SPAN, whichever is higher.
And the extreme loss margin is a minimum of 1%.
Why join the MCX Gold Frontpage forum?
MCX GOLD forum is all about discussions related to Gold rate, trading strategies, market information, and latest news related to MCX GOLD.
You can find MCX Gold Live Charts shared by experts.
You can also follow the 'Newsbot' account of FrontPage for finding the MCX Gold rate and all the latest share market news (Moneycontrol, Economictimes, Business Standard, Livemint) related to Gold and all other stocks.