Jaitley launches MCX gold options, says move will help formalise trade

Finance Minister Arun Jaitley on Tuesday launched gold options trading on the leading commodity bourse MCX and said this is one of the steps towards formalising trade in the yellow metal.

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.

"This marks a very important evolution in trading of yellow metal itself. It hedges all risks by giving them (traders) the option of futures," Jaitley said after launching the options trade on the auspicious day of Dhanteras.

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Indians are great buyers of gold. This new product will be extremely successful, he said.

Emphasising that the government is taking efforts to formalise gold trade, Jaitley said, "I am sure more it formalises, better it is for consumers, jewellers and those trading in this. That's in consonance with the business environment for future that we see for us".