Spot Market Reforms In Bullion & Way Forward

Spot Market Reforms In Bullion & Way Forward

Mr. Anjani Sinha MD & CEO, National Spot Exchange Ltd., www.nationalspotexchange.com

Our commitment to Indian Bullion Industry • Our group has revolutionized Indian Bullion market by providing a world class hedging tool to the Bullion Industry • Our next step is to revolutionize spot market of gold and silver by making it structured, institutionalized, transparent and risk free • This is the power of “Many to Many”

www.nationalspotexchange.com

Offering of National Spot Exchange • Single day contract for trading and delivery • Separate contracts for each delivery center • Trading hours : 10.00 am to 11.30 pm • During the day, buying, selling, netting, squaring off and settlement is possible • Outstanding position at end of the day must result into delivery • In case of non delivery by seller, NSEL will conduct auction at the cost of the defaulting seller • In case of failure of buyer to make payment, NSEL will conduct auction at the cost of the defaulting buyer • NSEL provides counter guarantee in respect of all trades www.nationalspotexchange.com

Bullion Contracts BULLION

SILVER

GOLD

GOLD REGULAR

LOT SIZE-1 KG

GOLD MINI

LOT SIZE-100 GRAMS

SILVER REGULAR

LOT SIZE-30 KG www.nationalspotexchange.com

Contracts to be launched • Separate contracts for : – Ahmedabad delivery – Mumbai delivery – Delhi delivery – Kolkata delivery – Chennai delivery – Bangalore delivery – Hyderabad delivery – And many more centers, depending upon need of the market

www.nationalspotexchange.com

Constituents of Bullion market • Banks • Importing Agencies • Bullion dealers • Jewellery manufacturers • Mutual Fund (Gold-ETF) • Traders/Brokers • Arbitrageurs • Retail Investors

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Facilities for banks and nominated agencies • Since this is not a futures contract, banks can directly become members of NSEL, else they can participate as constituents • Banks can sell bullion at multiple locations electronically in risk free environment with payment guarantee provided by NSEL • They can integrate suppliers’ quote plus margin forming orders to be submitted on NSEL • Located at one place, they can sell bullion at various locations across the country in risk free environment without any capital investment in setting up offices • Freedom from credit risk and counter party defaults in these volatile markets • Banks must prepare themselves to fight against intra-day and overnight volatility leading to customer’s defaults by using NSEL secured platform www.nationalspotexchange.com

Facilities for Bullion dealers • Get a readily available market to sell gold and silver • Expansion of trading and delivery business at various locations across the country using our platform • Take membership of NSEL and provide client id to your customers. Customers can place orders in NSEL terminal any time upto 11.30 pm • Instead of creating your own B2B portal, use the structured platform created by NSEL • Advantages: – No capital investment – Safe and secure mechanism – Increase size of business – Increase area of operation without investment www.nationalspotexchange.com

Facilities for Jewellery merchants • Power to quote your own buying price • Ease of quoting price at any point of time during your business hours • Ease of buying even 1 Kg or 100 grams of gold at parity price • Getting the most competitive quote on a single platform in your computer without making telephone calls • In times of parity as well as disparity, our prices will be nearer to physical market price • A benchmark spot price available for making your business decisions to buy or sell and also to fix your own price in your shop www.nationalspotexchange.com

Facilities for Traders / Brokers

• Potential for launching a full fledged Broking business in bullion market

• Developing clientele and earning handsome brokerage

• Ease of trading seamlessly at least cost

• Book profit based on intra-day trading

www.nationalspotexchange.com

Facilities for Retail investors

• NSEL provides an investment platform for HNIs and Retail investors

• Invest your savings into gold, hold gold in demat form, whenever you

wish, liquidate your stock and realize full appreciation value

• Storage cost Rs 7.50 per day for Gold 1 Kg ( Rs. 12 -13 lacs)

www.nationalspotexchange.com

Facilities for Arbitrageurs

• Arbitrage between spot and futures • Delivery fungible between spot and futures • Operational comfort: Spot and futures available on a single platform through CTCL • Canvass of commodity trading becoming complete with both cash and futures on electronic platform just like stock market

www.nationalspotexchange.com

Reforms in Indian Bullion Industry and way forward • A national level transparent spot price discovery platform • Indians participating in price discovery • Paradigm shift from – Price taker--- to Price Watcher ---to Price maker

• Structured Linkage between International Spot, International Futures, Domestic Spot and Domestic Futures with markets functioning as shock absorbers • Structured platform for canalizing savings into investment in Bullion www.nationalspotexchange.com

National Spot Exchange Platform

www.nationalspotexchange.com

Delivery in National Spot Exchange

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Thank You ! National Spot Exchange Limited 1st Floor, Landmark A Wing, Suren Road, Chakala, Andheri (East) Mumbai - 400093. Tel: +91-22-67619900 Fax: +91-22-67619931 E-mail: [email protected]

www.nationalspotexchange.com