NCDEX launches Silver Hedge contract

Commodity exchange NCDEX today launched its Silver Hedge contract and the unit of trading of the contract is 15 kg.

"Silver Hedge provides an effective way for price discovery of silver in India. It is designed as an intention-matching contract, where delivery occurs only when both buyer and seller agree in advance on the quantity and location.

"There is also a substantial saving in initial outgo resulting from this method of price discovery," NCDEX Managing Director and Chief Executive Samir Shah said in a release.

The contracts for April 2014 and June 2014 expiry is available for trading from February 19, 2014, NCDEX said.

Silver Hedge would be directly linked to international prices since it excludes import duty and any other local taxes thereby eliminating local price distortions.

The contract is meant for all customer segments from the physical traders and jewellers to retail investors.

While the physical traders and jewellers can use it as a risk management tool, retail investors can use it for adding silver to their investment portfolio.