An outlook by Mr.Ponmudi on the impact of the launch of Options trading in Silver by MCX

With the recent approval of SEBI, MCX India has launched the Options trading in Silver on 24 May 2018. As per the forecast of its launch by Mr.Ponmudi who is a well renowned market analyst and Managing Director of Enrich Financial India Pvt.Ltd, the following is the outcome.

A respectable volume of trading has taken place on the first two days. This enabled good volatility and liquidity in the market.

It was gainful for upside and downside trading in the market.

The equity segment participants, those who trade in NSE stock options and Index options are also likely to trade in Options Silver trading.

The numbers of market participants trading in Silver Options are seen to be on raise when compared to other option trading products.

International interference to pressure this market is less as more technical aspects are involved. Hence manipulation is less when compared to other markets.

High returns can be expected with low investment as limited risk is involved in trading Silver options.

The partaking of hedging strategy among the investors is expected to be fair in the upcoming days as the risk factor is less.

Brokerage charges are comparatively lower in trading Silver options.

CTT charges are lower in options trading.

It is a bright outlook for retail participation in the upcoming days.


On a closing note Mr.Ponmudi added that, the historical highs of Silver future prices show 73,600 almost a year back. The current volatility ratio shows 14.19 for 60 days in silver futures trading. With the launch of options trading in silver, the volatility of the price movement is expected to be on a rise. Hedging can be done here for reducing the risk. Once the volatility ratio is doubled, the market will fair excellently well.