Multi Commodity Exchange of India (MCX), the global leader in silver futures trading and among the world’s top five exchanges in gold, crude oil and natural gas futures trading, and Shanghai Futures Exchange (SHFE) of China today signed an MoU to share knowledge and expertise for further development of their exchange ecosystems.
The MoU was signed by Lamon Rutten, joint managing director of MCX, and Madam Wang Lihua, chairperson of SHFE, at the Pudong Shangri-La Hotel, Shanghai, China.
In order to ensure that the advantages of an efficient futures market are made available to the entire spectrum of users within and outside their respective countries and subject to the necessary regulatory approval, MCX and SHFE will share experiences, business rules, byelaws and regulations. This will include information on futures contracts traded on the exchanges along with delivery terms and conditions and risk management procedures.
Other terms stipulate official exchanges for greater expertise sharing and training of exchange personnel, sharing of delayed trading data that emanate from each exchange for internal use of the other exchange and their members, coordination of local industry efforts in consultation with each other to enable industry participants face competition and manage price risk better.
Mr Rutten said: “SHFE has established a very efficient futures market in metals and other commodities and will share its experience with MCX, which itself has developed a potent futures market in bullion, base metals, energy and agricultural commodities. MCX will share its experiences in these sectors with SHFE.”
Madam Wang Lihua stated, “The Shanghai Futures Exchange has been dedicated to knowledge sharing and cooperation with counterparts both at home and abroad and is eager to learn from overseas derivatives markets in terms of their success in product and system innovation. As the world’s exchanges step up industry consolidation amid the trend of increasing economic globalization, the Shanghai Futures Exchange has taken an important step by joining hands with MCX and forming a strategic partnership. The singing of the MoU between the two exchanges will enable both sides to exchange information, engage in constructive cooperation and take advantage of each other’s strengths.”
The Mumbai-based MCX (mcxindia.com) is an independent, demutualised nationwide electronic multi commodity futures exchange set up by Financial Technologies with permanent recognition from Government of India for facilitating online trading, clearing & settlement operations for futures market across the country. The exchange started operations in November 2003 and presently is the top commodity exchange in the country with 70% market share of the total commodity derivatives trading volume in the country. Among the top ten commodity derivatives exchanges in the world, MCX ranks among the top three bullion, energy and copper exchanges in the world in terms of contracts traded. The average daily turnover of MCX is about US$2.15 billion.
In addition to being an ISO 9001:2000 company for quality management, it is the world’s first and only multi-commodity exchange to have achieved ISO 27001:2005 certification, the global benchmark for information security management systems.
MCX offers futures trading in 65 commodities including commodities ranging from bullion, agri-commodties to plastics and fibers, defined in terms of the type of contracts offered. The exchange strives to spearhead developments in the commodities futures industry. Therefore it has forged ten strategic alliances across the world, including with Tokyo Commodity Exchange, Chicago Climate Exchange, London Metal Exchange, New York Mercantile Exchange, New York Board of Trade and Bursa Malaysia Derivatives, Berhad.
Financial Technologies India Ltd, a leading provider of transaction automation technologies for equities, derivatives, forex and commodity markets, holds a major stake in MCX. Other key stakeholders include Fidelity International, State Bank of India & its subsidiaries, National Stock Exchange (NSE) and National Bank for Agriculture & Rural Development (NABARD).
About Shanghai Futures Exchange
Shanghai Futures Exchange (SHFE) is organized under relevant rules and regulations. A self-regulated entity, it performs functions that are specified in its bylaws and state laws and regulations. It is regulated by the China Securities Regulatory Commission (CSRC). At present, futures contracts underlying five commodities, i.e., copper, aluminum, natural rubber, fuel oil and zinc, are listed for trading.
For further information please contact:
Ravi Muthreja, Head, Communications, MCX
P: +91 22 66497000 / M: +91 9867726000 / E: Ravi.muthreja[.]mcxindia.com.