News – Industry players all for local mercantile exchange

How do you buy and sell something over and over again without ever concern about taking delivery or selling the actual thing? You use “paper-based” trading technique made famous (in scandal) by Chicago Mercantile Exchange and New York Mercantile Exchange. You will not be concern a bit about the existence of the actual thing being trade in the exchange, yet.

Recently, the Securities Commission (SC) introduced the concept of a mercantile exchange for trading and hedging of gold futures and other precious metals.

The idea for such a mercantile exchange has its roots in the Capital Master Plan 2, which states that its intentions are to increase products on the derivatives market to deepen market liquidity, improve the ability to trade across markets and to hedge risks.

Reliable sources said the SC was actively drawing up its plans and would draw from lessons learnt in other markets to set up the local mercantile exchange.

Currently, the leading mercantile exchanges of the world are the Chicago Mercantile Exchange and New York Mercantile Exchange where it is deemed as the benchmark for global price discovery on commodities traded which include gold among other commodities.