The Shanghai Futures Exchange (SFE), one of China's major futures trading agencies, said on Thursday that it has completed basic preparations for gold futures trading and will launch the new service as soon as possible.
The SFE had "designed strict regulations on the risk control measures for gold futures", said Teng Jiawei, vice executive president of the SFE.
The measures included a minimum margin requirement of seven percent of the value of gold futures contracts.
"Due to big fluctuations in gold prices, we set a relatively high level of the margin requirement," said Teng.
The daily fluctuation of gold futures prices should not exceed plus or minus five percent of the settlement prices of a previous day, he said.
The exchange was soliciting public suggestions on gold futures contracts and regulations, which would be considered when setting the final regulations, said Teng.
Gold prices have fluctuated strongly, prompting gold producers, financial institutions and investors to avert risks through futures trading, the SFE said.
Last year, China produced a record 240 tons of gold, a growth of 7.15 percent year-on-year. In the first five months this year, the country produced 98.89 tons of gold, up 10.09 tons or 11.37 percent from the same period last year, according to the China Gold Association
(Xinhua News Agency September 14, 2007)
