Trading volume of gold declines as prices rise
22 Nov 2009, 0304 hrs ET Bureau
NEW DELHI: Investing in yellow metal may no longer be a safe haven as investors are taking a cautious call on buy and sell of gold these days.
With gold prices touching an all time high, the participation in terms of trading volume is declining. In fact, the trading volume during October-November has halved in comparison to the volume during March-April this year, a SundayET analysis has revealed.
According to the analysis, during the month of October when the average monthly gold price was around Rs 15,888 per 10 gram, the total trading volume of gold in Multi Commodity Exchange (MCX) in terms of number of lots traded was 1,869,136, which is around 46% less than that of January this year. During January, 2009, the average monthly gold price was Rs 13,496 per 10 gram.
Also, in terms of traded quantity, the volumes have gone down substantially. The gold volumes were at its peak during January to March, after which prices skyrocketed forcing the trading volume to decline. During January and February, the volume was 1,562 tonne and 1,564 tonne. Again in March, the trading volume shoot up to 1,799 tonne. During the current month till now, the gold volume in terms of lots traded stood at 1,211,971 in MCX.
Similarly, in National Commodity & Derivatives Exchange (NCDEX), trading volume of gold was up during January to March. And by October, the trading volumes declined substantially. Explaining the reasons behind declining volumes, Jayant Manglik, president of Religare Commodities said, “It is not the price but the speed at which the prices appreciated which has impacted the volume. But it is a temporary phenomenon, and volumes are going to rise soon.”
Also, many experts feel that some amount of volume has shifted towards silver too. According to the data sourced from MCX, during October this year, the trading volume on silver was 38,984 tonne, a rise of 6% from January this year.
According to the data released recently by World Gold Council, the demand for gold in India has gone down by around 49% during Q3 of CY09 due to high gold prices and weak dollar.
22 Nov 2009, 0304 hrs ET Bureau
NEW DELHI: Investing in yellow metal may no longer be a safe haven as investors are taking a cautious call on buy and sell of gold these days.
With gold prices touching an all time high, the participation in terms of trading volume is declining. In fact, the trading volume during October-November has halved in comparison to the volume during March-April this year, a SundayET analysis has revealed.
According to the analysis, during the month of October when the average monthly gold price was around Rs 15,888 per 10 gram, the total trading volume of gold in Multi Commodity Exchange (MCX) in terms of number of lots traded was 1,869,136, which is around 46% less than that of January this year. During January, 2009, the average monthly gold price was Rs 13,496 per 10 gram.
Also, in terms of traded quantity, the volumes have gone down substantially. The gold volumes were at its peak during January to March, after which prices skyrocketed forcing the trading volume to decline. During January and February, the volume was 1,562 tonne and 1,564 tonne. Again in March, the trading volume shoot up to 1,799 tonne. During the current month till now, the gold volume in terms of lots traded stood at 1,211,971 in MCX.
Similarly, in National Commodity & Derivatives Exchange (NCDEX), trading volume of gold was up during January to March. And by October, the trading volumes declined substantially. Explaining the reasons behind declining volumes, Jayant Manglik, president of Religare Commodities said, “It is not the price but the speed at which the prices appreciated which has impacted the volume. But it is a temporary phenomenon, and volumes are going to rise soon.”
Also, many experts feel that some amount of volume has shifted towards silver too. According to the data sourced from MCX, during October this year, the trading volume on silver was 38,984 tonne, a rise of 6% from January this year.
According to the data released recently by World Gold Council, the demand for gold in India has gone down by around 49% during Q3 of CY09 due to high gold prices and weak dollar.
