E-trading to cover more metals next year

Written by Sandip Das | New Delhi | Updated: Nov 8 2010, 07:07am hrs
Retail investors investing in gold and silver through electronic spot exchange in the last few months would now have the option to buy many more metals during next one year.

E-gold and e-silver which was launched by the National Spot Exchange Limited (NSEL) promoted by a consortium of companies, including Financial Technologies (promoter of MCX, the countrys largest commodity exchange) since March 2010 is rolling out e-copper this week and has plans to launch more than 20 ferrous and non-ferrous metals for the investment purpose during the next one year.

According to an NSEL official, the average daily volume through e-trading after the launch of copper is expected to grow by Rs 10-15 crore.

The systematic investment plan (SIP) which is being offered to investors for e-gold and e-silver would also be offered for e-copper.

Through electronic holding, retail investors hold their investment in metals through their demat accounts while the equivalent physical commodity is maintained at designated vaults, Anjani Sinha, chief executive officer and managing director, NSEL told FE.

E-gold and e-silver is available on the order driven electronic trading platform, where investors are also allowed to quote their own buying and selling price. The same price is available across the country and so, buyers and sellers from anywhere in the country can buy and sell at this price, Sinha said.

While e-gold and e-silver posted a record daily turnover of Rs 115 crore due to increase in participation by retail investors on October 7 on the occasion of Dhanteras last week the daily volume went up to as high as Rs 160 crore. Last month, while e-gold recorded a highest daily turnover of Rs 37.17 crore, e-silver recorded a turnover of Rs 77.59 crore.

Sinha claimed that investors need to register as a client with any member of NSEL and participate in these products. E-gold has advantage over other gold based investment products in terms of cost, price transparency, and convenient mechanism of buy and sell over approximately 14-hour market, he said.