Spot Market Reforms In

Bullion & Way Forward

Mr. Anjani Sinha

MD & CEO, National Spot Exchange Ltd.,

www.nationalspotexchange.com
Our commitment to Indian
Bullion Industry

• Our group has revolutionized Indian Bullion market by providing a world

class hedging tool to the Bullion Industry

• Our next step is to revolutionize spot market of gold and silver by making

it structured, institutionalized, transparent and risk free

• This is the power of “Many to Many”

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Offering of National Spot Exchange

• Single day contract for trading and delivery

• Separate contracts for each delivery center
• Trading hours : 10.00 am to 11.30 pm
• During the day, buying, selling, netting, squaring off and settlement is
possible
• Outstanding position at end of the day must result into delivery
• In case of non delivery by seller, NSEL will conduct auction at the cost of
the defaulting seller
• In case of failure of buyer to make payment, NSEL will conduct auction
at the cost of the defaulting buyer
• NSEL provides counter guarantee in respect of all trades

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Bullion Contracts

BULLION

GOLD SILVER

GOLD REGULAR GOLD MINI SILVER REGULAR

LOT SIZE-1 KG LOT SIZE-100 GRAMS LOT SIZE-30 KG

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Contracts to be launched

• Separate contracts for :

– Ahmedabad delivery
– Mumbai delivery
– Delhi delivery
– Kolkata delivery
– Chennai delivery
– Bangalore delivery
– Hyderabad delivery
– And many more centers, depending upon need of the market

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Constituents of Bullion market

• Banks

• Importing Agencies

• Bullion dealers

• Jewellery manufacturers

• Mutual Fund (Gold-ETF)

• Traders/Brokers

• Arbitrageurs

• Retail Investors

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Facilities for banks and
nominated agencies
• Since this is not a futures contract, banks can directly become members
of NSEL, else they can participate as constituents
• Banks can sell bullion at multiple locations electronically in risk free
environment with payment guarantee provided by NSEL
• They can integrate suppliers’ quote plus margin forming orders to be
submitted on NSEL
• Located at one place, they can sell bullion at various locations across
the country in risk free environment without any capital investment in
setting up offices
• Freedom from credit risk and counter party defaults in these volatile
markets
• Banks must prepare themselves to fight against intra-day and overnight
volatility leading to customer’s defaults by using NSEL secured platform

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 Facilities for Bullion dealers

• Get a readily available market to sell gold and silver

• Expansion of trading and delivery business at various locations across
the country using our platform
• Take membership of NSEL and provide client id to your customers.
Customers can place orders in NSEL terminal any time upto 11.30 pm
• Instead of creating your own B2B portal, use the structured platform
created by NSEL
• Advantages:
– No capital investment
– Safe and secure mechanism
– Increase size of business
– Increase area of operation without investment

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 Facilities for Jewellery merchants

• Power to quote your own buying price

• Ease of quoting price at any point of time during your business hours

• Ease of buying even 1 Kg or 100 grams of gold at parity price

• Getting the most competitive quote on a single platform in your

computer without making telephone calls

• In times of parity as well as disparity, our prices will be nearer to

physical market price

• A benchmark spot price available for making your business decisions to

buy or sell and also to fix your own price in your shop

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 Facilities for Traders / Brokers

• Potential for launching a full fledged Broking business in bullion market

• Developing clientele and earning handsome brokerage

• Ease of trading seamlessly at least cost

• Book profit based on intra-day trading

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 Facilities for Retail investors

• NSEL provides an investment platform for HNIs and Retail investors

• Invest your savings into gold, hold gold in demat form, whenever you

wish, liquidate your stock and realize full appreciation value

• Storage cost Rs 7.50 per day for Gold 1 Kg ( Rs. 12 -13 lacs)

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 Facilities for Arbitrageurs

• Arbitrage between spot and futures

• Delivery fungible between spot and futures

• Operational comfort: Spot and futures available on a single platform

through CTCL

• Canvass of commodity trading becoming complete with both cash and

futures on electronic platform just like stock market

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Reforms in Indian Bullion Industry and way
forward

• A national level transparent spot price discovery platform

• Indians participating in price discovery

• Paradigm shift from

– Price taker--- to Price Watcher ---to Price maker

• Structured Linkage between International Spot, International Futures,

Domestic Spot and Domestic Futures with markets functioning as

shock absorbers

• Structured platform for canalizing savings into investment in Bullion

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National Spot Exchange Platform

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Delivery in National Spot Exchange

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 Thank You !

National Spot Exchange Limited

1st Floor, Landmark A Wing,
Suren Road, Chakala, Andheri (East)
Mumbai - 400093.
Tel: +91-22-67619900 Fax: +91-22-67619931
E-mail: info@nationalspotexchange.com

www.nationalspotexchange.com