Gold futures trading in India is primarily conducted on the Multi Commodity Exchange (MCX), where multiple gold contracts are available to cater to different participant categories, including institutional traders, jewellers, refiners and retail market participants. These gold futures contracts differ based on purity, contract size, delivery unit and settlement mechanism, making it important to understand how each contract functions.
Currently, MCX offers four major types of gold futures contracts, namely Gold, Gold Mini, Gold Guinea and Gold Petal, each designed to serve a specific market segment.
Gold futures (Gold 995 / Gold 999) on MCX
The standard Gold futures contract is the most actively traded gold derivative in India. This contract represents high-purity gold and is typically used by large traders, bullion dealers and institutional participants.
The contract is quoted per 10 grams and settled through compulsory delivery unless squared off before expiry. The purity standards ensure consistency with international bullion benchmarks.
| Parameter | Details |
|---|---|
| Contract size | 1 kilogram |
| Purity | 995 or 999 |
| Price quotation | Rs per 10 grams |
| Exchange | MCX |
| Settlement | Compulsory delivery |
This contract provides deeper liquidity and higher trading volumes compared to smaller gold contracts.
Gold Mini futures: smaller exposure with high purity
Gold Mini futures were introduced to allow retail traders and small hedgers to participate in gold futures trading with reduced capital requirements. The purity remains the same as the standard gold contract, but the lot size is significantly smaller.
| Parameter | Details |
|---|---|
| Contract size | 100 grams |
| Purity | 995 |
| Price quotation | Rs per 10 grams |
| Exchange | MCX |
| Settlement | Compulsory delivery |
Gold Mini futures maintain pricing parity with standard gold contracts while offering easier access to the gold derivatives market.
Gold Guinea futures: traditional Indian gold unit
Gold Guinea futures are based on the traditional Indian gold measurement unit, historically used in physical bullion trading. This contract is often preferred by jewellers and bullion traders familiar with the guinea system.
| Parameter | Details |
|---|---|
| Contract size | 8 grams |
| Purity | 995 |
| Price quotation | Rs per 8 grams |
| Exchange | MCX |
| Settlement | Compulsory delivery |
Gold Guinea futures bridge traditional bullion practices with modern derivatives trading infrastructure.
Gold Petal futures: entry-level gold futures contract
Gold Petal futures are the smallest gold futures contracts available in India, designed specifically for first-time participants and small-scale traders. Despite the small contract size, these futures follow the same pricing mechanism as larger gold contracts.
| Parameter | Details |
|---|---|
| Contract size | 1 gram |
| Purity | 995 |
| Price quotation | Rs per 1 gram |
| Exchange | MCX |
| Settlement | Compulsory delivery |
Gold Petal futures significantly lower the entry barrier for participation in gold futures trading.
Comparison of all gold futures contracts in India
The table below summarises all major gold futures contracts traded in India, highlighting their key differences in a consolidated format.
| Contract Type | Lot Size | Purity | Target Participants |
|---|---|---|---|
| Gold | 1 kg | 995 / 999 | Institutions, bullion dealers |
| Gold Mini | 100 g | 995 | Retail traders, small hedgers |
| Gold Guinea | 8 g | 995 | Traditional bullion traders |
| Gold Petal | 1 g | 995 | Entry-level participants |
Each contract is structured to serve different liquidity needs and capital capacities without compromising purity standards.
How gold futures prices are determined
Gold futures prices in India are closely aligned with international gold prices, adjusted for rupee-dollar exchange rates, import duties and local taxes. MCX gold futures also reflect global cues from major bullion markets such as London and New York.
Domestic demand, festival buying trends and global macroeconomic factors further influence price movements across all gold futures contracts.
FAQs on gold futures in India
How many types of gold futures are traded in India?
India currently trades four main gold futures contracts on MCX: Gold, Gold Mini, Gold Guinea and Gold Petal.
Which gold futures contract has the smallest lot size?
Gold Petal futures have the smallest lot size at 1 gram, making them the most accessible gold futures contract.
Is purity the same across all gold futures contracts?
Yes, all gold futures contracts on MCX maintain a purity of 995 or higher, ensuring uniform quality.
Are gold futures settled physically in India?
Yes, MCX gold futures are compulsorily settled through physical delivery unless positions are squared off before expiry.
Why are multiple gold futures contracts offered?
Multiple contracts exist to cater to different market participants, ranging from large institutions to small retail traders.