TheMulti Commodity Exchangehas introduced gold option contracts for the first time in India. The derivative instrument allows investors to enter into contracts to either buy or sell gold sometime in the future at a pre-determined price, thus allowing investors to hedge any volatility in the price of the metal, for a price. ________________. As the Finance Minister stated during the launch of the derivative at the MCX, gold options will also help bring into formal channels more of the gold that is traded. Notably, the introduction of gold options is in line with the government’s announcement last year that it would take steps towards introducing new varieties of commodity derivatives in the market.
The correct answer is B