The Indian Commodity Exchange Ltd (ICEX) has opened up world’s first ever diamond future trading exchange which will help diamond makers to limit price risks and get maximum profits.
Diamond trading may seem glittery glamorous, but only a diamond maker knows the risks associated with it, so to help making diamond futures trading easier, ICEX has opened up world’s first ever Diamond Trading Exchange in India. From today, mock trading sessions which will help the traders in getting used to the system before actual trading begins by the end of August of first week of September. The mock round will also help traders clearing the doubts and understand and experience price hedging methodology, by practically doing it in a near-live environment.
Indian diamond cutters polish about 14 of every 15 of the world’s gems and imported about 153 million carats of rough diamonds in the financial year ended March 31. The exchange, backed by companies including Reliance Capital LtdBSE 1.72 %. and MMTC Ltd.BSE 1.08 %, will start trading in 1 carat/100 cent contracts and will eventually add 50 cent and 30 cent contracts. Polishers source their gems from De Beers, the world’s biggest diamond producer, and also through direct imports from some producing nations.
The diamond industry consists of manufacturers or ‘diamantaires’ (the term for owners of cutting and polishing units), wholesalers, traders, brokers, retailers and jewellery fabricators. All these parties are expected to make use of the platform to get better hedge price risks and boost the quality of Indian diamond trading which will provide a safer trading system for the dealers.