The initial margin in Tehran’s gold futures market will go up by five percent from Wednesday December 17, as coin futures trading picks up on safe haven demand.
Traders will initially be required to put up 21 million rials ($601 at market rate) for each gold bullion coin futures contract, a one-million-rial increase but a $150 decrease in dollar terms due to decline in the value of the rial.
The margin will be raised by the Iran Mercantile Exchange’s admission committee because of a hike in the settlement value of contracts in recent days.
The initial margin was lowered in September as coin futures saw little trading. But the trend has changed now with a hike in futures trade, mirroring the increase of gold coin trade in Tehran’s market.
The initial margin, which must be deposited in the account to start trading contracts as a down payment for the delivery of the contract and ensuring that the parties honor their obligations, was raised to record highs in 2012 due to an increase in the volatility of gold coin prices.
Each lot in an IME gold coin futures contract is for ten Emami gold coins.
