Ordinary investors can soon trade in diamonds

Mumbai: Indian Commodity Exchange's (ICEX) diamond futures contract, that's awaiting Sebi's nod, has been designed in a way to allow ordinary investors to lay wagers on and even take delivery of diamonds on the Reliance Capital-anchored bourse.

Sebi is examining the nuts and bolts of the ambitious contract that hasn't yet been launched on a derivatives exchange.

“You have gold, stocks, bonds and the like as investments avenues but diamonds were missing from the investors' list for lack of a feasible exit option,“ said a person aware of the contract design. “ICEX's contract, if approved, will give him that ability by not only allowing him to benefit from price appreciation but also facilitating delivery at the expiry of a contract.“ Former employees of MCX, the country's largest commodity exchange, have played a significant role in contract design, ET has learnt. Three contracts will be available to investorstraders ­1 carat, 50 pointer (cents) and 30 pointer of HVS2, one of the largest traded stones. That makes a total of nine concurrent contracts. However, the lot size of each contract will be one cent or one-hundredth of a carat.