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Dec 27, 2014

Awareness Programme on Commodity Futures to Highlight the Benefits of ‘Hedging’

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Multi Commodity Exchange of India Ltd
Awareness Programme on Commodity Futures to Highlight the Benefits of ‘Hedging’
Bengaluru, Karnataka, India

Multi Commodity Exchange of India Ltd (MCX) in association with the Forward Markets Commission (FMC), organised an awareness programme at Bengaluru on Friday, December 26, 2014. It aimed at increasing hedgers’ participation on the commodity futures exchanges and the manner in which they could be used as effective price risk management tools. It was graced by the presence of Shri. S. K. Mohanty, Director, Forward Markets Commission. He highlighted the importance, effectiveness and benefits of the commodity futures market for the market participants. Moreover, he spoke about the reforms planned for the commodity futures market.

The programme was an opportunity for the market participants to understand about the commodity futures market, the technicalities of working of the commodity markets with respect to the products, price discovery, transparency and risk management mechanism in trading and settlement of transactions. The experts during the session spoke on various aspects of commodities trading in India from an Indian and a global perspective. Additionally, they highlighted the role of FMC in regulating and monitoring the functions of commodity exchanges in building confidence of the market participants, and for the growth of commodities market in India.

While explaining in detail about risk management and price discovery, the two fundamental and critical functions performed by the commodity exchanges, Mr. N. K. Muthappa, Assistant Vice President-Business Development MCX said, “In a span of around twelve years, the Indian commodity market has come a long way, and thus providing hedging opportunities to the market participants in the commodity space.”

“Commodity exchanges such as MCX provides a platform for the commodity value chain participants to hedge their price risks using a wide range of futures contracts in bullion, base metals, energy, and agri segment to insure themselves against adverse price fluctuations,” he added.

The market participants thanked both FMC and MCX for organising this interactive session which helped them gain an insight into the commodity futures markets.


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