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NCDEX to launch guarseed options trading on Jan 14

Press Trust of India  |  New Delhi 

today said it will launch the country's first agri-options in guarseed on January 14 with an aim to give stakeholders a new set of financial instruments to their price risks.

The options trading in guarseed will be inaugurated by Minister on the auspicious day of Hindu festival 'Makar Sankranti'.

is the second exchange after to launch trading in commodities. In October 2017, had launched gold options. Guarseed will be the first agri-options.

Options are derivatives which give a buyer the right but not the obligation to buy or sell an underlying asset or instrument at a specific price on or before a certain date.

Announcing the day of the launch, MD and Samir Shah said: "Options will protect farmers from downward price movement as well as give them an opportunity to sell their produce at higher prices in case of price increase."

This instrument will create a win-win situation for farmers, irrespective of the price movement, he was quoted as saying in the statement.

NCDEX said it is launching guarseed options as it is one of the most liquid contracts on the exchange platform.

Besides, a large number of informal trading centres in some communities of are already involved in some form of informal options trading, ii added.

While the market regulator Sebi had allowed exchanges to launch options in September 2016; it was only on April 26, 2017, it clarified that the options would have futures as underlying for settlement.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, January 12 2018. 17:35 IST