FMC allows algo trading in Gold 100gm contract

The Forward Markets Commission (FMC), the commodity derivatives market regulator, has allowed algo/high frequency trade in Gold 100 gram futures contract.

The regulator had prohibited algo/high frequency trade in micro and mini futures contracts traded on national exchanges effective January 1, 2013 so as to enable the small and retail participants in the value chain to hedge their price risk.

The Commission has now received a representation from an exchange requesting that the algo/high frequency trade may be allowed in Gold 100 gm futures contracts traded on the exchange platform.

Owing to high contract value of 100gm gold, the Commission has taken a decision to allow algo/high frequency trade in Gold 100 gm futures contracts traded on all the exchanges, the FMC said in a communication to commodity exchanges.