About Gold Trading in India

The market for gold is booming in India.

India has emerged as one of the prime markets for trading in the spot and futures gold trade, and several global banks have considered entering the trade there. In some villages in India, gold is now preferred over bank deposits for savings and investments.

The Market

The market in India imports and consumes the largest quantity of gold in the world: 400 tonnes in 2009 alone. Analysts expect the market, currently worth around $16.1 billion, to continue booming. The investment of global banks can only help this.

How to Trade

To trade in bullion (silver or gold) in the Indian exchanges, there is a minimum investment of Rs650 ($1425) and Rs950 ($20.83). Traders can choose from three futures exchanges: the National Commodity and Derivative Exchange, the Multi Commodity Exchange of India, Ltd and the National Multi Commodity Exchange of India, Ltd. A list of brokers can be found through the exchanges; some of them offer trading over the Internet. Brokers will charge between .10 and .25 percent of the contract value. Information on the markets can be found in financial newspapers and online at sites such as indiabullion.com.

Regulators

Exchanges are regulated by the Forward Markets Commission, but brokers are not required to register with them. However, the FMC will investigate if brokers are suspected of foul play.

References

• Commodity Online: Global banks eye gold trading in India
• Trading Picks: Beginners Guide to Commodities Futures Trading in India
• Indian Bullion: Market News

Resources

• The Bullion Desk