NCDEX LAUNCHES ANOTHER HEDGING TOOL IN INDEX AS “GUAREX” | Swastika Blog - Share Market Updates, Latest News and Expert's Tips | Swastika Investmart Ltd (Swastika Investmart) Swastika

NCDEX LAUNCHES ANOTHER HEDGING TOOL IN INDEX AS “GUAREX”

Just like AGRIDEX, NCDEX had launched another price based index named GUAREX which is mainly based on the price movements of Guarseed and Gurugum where the weights are 63.43% and 36.57% respectively.

Guar (Cyamopsis tetragonoloba) is a leguminous crop, which grows best in sandy soils and needs moderate, intermittent rainfall. It is a hardy, drought-resistant bush and is sown after the first monsoon showers between the second half of July and early August.

Guar gum is used as a thickening and binding agent in the food, textile, paper, pharmaceutical and oil industries.

Highly refined guar gum is used in the food industry as a stabilizer in ice creams, as a meat binder and a stabilizer for cheeses, instant puddings and whipped cream substitutes.

Guar gum is used in industrial applications including cloth and paper manufacture, oil well drilling, explosives, ore flotation, and many other applications.

India is the major producer of Guar as it produces almost 80% of the world’s total production where Rajasthan contributes the highest almost 70-80% of the total production of India.

GUAREX index is a real-time commodity futures price index as it is designed to provide exposure to market participants who are dealing in guar complexes. This index will act as an important hedging tool as it will help in diversifying the positions.

       BENEFITS:

  • Cash settlement
  • Very little margin is required compared to the underlying
  • Low transaction cost
  • Steady returns
  • SEBI has now allowed the benefit in Commodity Index futures
  • Multiple entries and exit points 

       CONTRACT SPECIFICATIONS:

  • LOT SIZE – 100 UNITS

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