Bursa Malaysia To Launch Cash-Settled Gold Futures Contract (FGLD)

03/10/2013

Malaysia’s first precious metal futures contract will begin trading on Bursa Malaysia from 7 October 2013.

This new cash-settled gold futures contract (Contract Code: FGLD), will be available to all market participants, particularly domestic retail investors, to trade gold on the derivatives exchange of Bursa Malaysia.

The Ringgit-denominated contract will be traded in small contract sizes of 100 grams, enabling investors to trade in small quantities, making each transaction affordable to all those who want to trade gold, whether as a professional, or the public at large.

Dato’ Tajuddin Atan, Chief Executive Officer of Bursa Malaysia Berhad and the Chairman of Bursa Malaysia Derivatives said, “The launch of the new Bursa Gold Futures Contract underscores the commitment of Bursa Malaysia to continuously introduce new products and asset classes, thereby bringing more trading and investment opportunities to more Malaysians.”

“Our aim is to create a comprehensive marketplace where there is something for every type of trader and investor on Bursa Malaysia. We are confident that the new Bursa Gold Futures Contract, because it is traded on our highly regulated exchange, will become the trusted way to trade gold in Malaysia.”

Mr Chong Kim Seng, the Chief Executive Officer of Bursa Malaysia Derivatives Berhad, said, “In Malaysia, where gold is a highly desirable commodity from a cultural standpoint, the minimum contract size of 100 grams for the Bursa Gold Futures Contract provides greater accessibility and affordability to all those who want to trade and invest in gold.

Gold jewelers, manufacturers and stockists are anticipated to be active users of the Bursa Gold Futures Contract to hedge their gold inventory risks and their forward gold purchases.

The Ringgit denomination minimises the risks associated with foreign currency fluctuations thereby providing convenience and flexibility to trade gold futures on Bursa Malaysia.”

“The Bursa Gold Futures Contract will be traded under the symbol FGLD, on the derivatives exchange of Bursa Malaysia and traded through our licensed and regulated Futures Brokers,” he said.

Mr Chong continued, “The Bursa Gold Futures Contract will be cash-settled based upon the London AM Fix price in USD, which provides confidence in price transparency making it as close as possible to the true price of gold”.

For more information on the new FGLD or gold futures contract and how to start trading gold futures on Bursa Malaysia Derivatives.