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Gold Geojit Comtrade Bullion Market
Gold Geojit Comtrade Bullion Market
Gold Geojit Comtrade Bullion Market
Contents
General Facts Why invest in Gold? Price Determining factors for gold
General Facts
Jewellery
5% 17% 46% Total bar and coin invest ETFs and similar Technology
32%
Year
Central Banks purchases/sales. Hedge against financial stress. Jewelery and Industrial demand. Gold mining Production and Supply. War, invasion and economic uncertainty.
Central Banks
Central banks and IMF play an important role in the gold price.
Jewelry and Industrial demand Jewelry accounts for over two-third of annual global demand. India is the largest consumer of gold Jewelry followed by China and the U.S.
Industrial, dentistry and medical uses account for around 12% of gold demand.
Recycling activity was 3% down year-on-year, as consumers in many markets held off on selling their existing 'loose' holdings of gold in anticipation of higher prices.
The completion of de-hedging by worlds two miners Barrick Gold mine and Anglo Ashanti Gold mine reduces the possibility of a price rise as seen in 2009 and 2010.
Gold @$1700
Standard and Poor (S&P) downgrades U.S credit rating in August 2011
Gold @$1800 Greece on verge of 98 percent default in September 2011 Standard and Poor (S&P) downgrades Italys credit rating in September 2011
GDP Non Farm Payrolls Industrial Manufacturing Data Business Inventories Value of U.S dollar Economic Stimulus package if announced Trade deficit
Spot Gold
MCX Gold
Spot Gold
Dollar
Negative Correlation
Gold jewelry represented around 75 per cent of the total Indian gold demand in 2010.
The southern states like Kerala, Andhra Pradesh, Tamil Nadu and Karnataka account for over 40 per cent of the country's gold demand. The research highlights that with 50 per cent of the Indian population under 25 and approximately 150 million weddings anticipated over the next decade, which will drive gold consumption.
Types of Investments
Physical
Jewelery Bars/Coins
Non Physical
Gold mining shares ETFs Futures(can be converted into physical) E Gold (can be converted into physical)
Assume that on September 30th, John Thomas fixed his daughter Christina Johans wedding to be on 2012 May 6th, and that he plans to buy 25 pavan (200 g) gold as jewelry.
Block over 5.5 lacs (at present level). Risk the possibility of a price fall later.
Block only less than 50,000 as margin amt (at present prices) Invest the rest of 5 lacs in bank or other safe assets for 1 month. Hold the gold in demat form, maintain MTM.
P/L scenario @ End of April 2012 for MCX Gold purchase @2750
Time
Profit / Loss
Conclusion
Buy jewelry at high Oct prices, (and more with the extra gain)
John avoids the high priced buy in Dec. Would be able to buy Jewelry at lower April prices.
Note: This notional loss from futures can be reduced or nullified. Standing instruction can be given to exit futures if price fall below 2700 (or suitable prices), so that the loss is limited to Rs.10000 or even much lower. The flexibility of easy entry and exit available through online futures trading platform, enables even better strategies than that mentioned above.
Jeweler Scenario:
Risks on both directions due to high volatility. Advance booking by customers Commitment to suppliers
Jewelers choices
Hope Prices do not fall sharply after stocking or Hope that prices do not rise sharply before stocking Hedge with gold futures; Sell and buy against each stock moves
Research Support
USE our research to know about major trends, entry/exit points etc. Daily Gold report Strategies (Short term as well as long term) for both International as well as MCX Gold News Alert : Both Indian as well as International Technical Analysis and Charts Customer support through phone, sms, email, website
High depth/liquidity (MCX is no: 1 in India and no: 2 in world as per its website.)
Different denominations available (1kg, 100g, 8g, 1g). Trading hours (10am to 11 30pm) covers all major mkts. Take/give delivery if you want. Store/Sell from demat. Margins as low as 4 to 7%
Pedigree
Constituted by staff from erstwhile Geojit Commodities and other industry stalwarts.
GEOJIT COMMODITIES
Number 1 Broking house status in terms of Trading Terminals : Dun & Bradstreet Survey 2008 The first brokerage to offer online trading in Rubber (Mar 2003), Pepper (Apr2003), Gold (Oct2003), Wheat and Rice (Dec2003), Cardamom (Apr 2004) and Coffee (Feb2006) Brand image of Industry Pioneer since inception of commodity futures in 2003
Latest advancements
Geojits Flip Ultimate, which has integrated the three major national level exchanges : MCX, NCDEX & NMCE on to a single platform. Mobile Trading in commodities for the first time in NCDEX/NMCE. Facility to trade in International Markets. One touch terminals.
Door No. XXXVI/1567, Canal Road, Kaloor, Kochi, India-682016, Phone: +91 484 2401224/5, Fax: +91 484 2402482 Email: customercare@geojitcomtrade.com Web: www.geojitcomtrade.com
MCX Member code: 40220 FMC No.: MCX/TCM/CORP/1710, NCDEX Member code : 00920 FMC No.:NCDEX/TCM/CORP/0895, NMCE Member code : CL0324 FMC No.: NMCE/TCM/CORP/0245, NSEL Member Code : 12770