Leading agri-commodity bourse NCDEX on Wednesday announced the launch of a return-based agri-futures index 'AGRIDEX' in partnership with NSE Indices Ltd. NCDEX AGRIDEX will track and replicate the performance of the ten most liquid commodities traded on the NCDEX platform, the exchange said in a statement.
The agri-futures index, NCDEX Vice Executive President Kapil Dev said, "will act as a robust indicator of the broader market and its strong surveillance will give enough confidence to the traders".
NCDEX said it will launch tradable futures contracts on AGRIDEX on receipt of the regulator Sebi's approval. These contracts will be cash settled as per the regulatory guidelines. These index futures contracts will not only provide the opportunity to hedge position in more dynamic way but will also provide unique trading and arbitrage opportunities for market participants, it said.
As the index represents a diverse basket of commodities, NCDEX said it is a less risky and more predictable compared to individual commodity. Futures trading on AGRIDEX will also enhance overall liquidity on exchange platform.
National Commodity & Derivatives Exchange Limited (NCDEX) offers derivatives trading in commodities and has largest share in the agricultural commodities.