Bloomberg News

Shanghai Futures Exchange Lowers Gold Margins to Boost Trading

February 15, 2012

Feb. 15 (Bloomberg) -- The Shanghai Futures Exchange, China’s biggest metals bourse, lowered the margins on gold for trading the contract in the final month before its expiry to boost volumes and attract more investors.

The margin requirement, or the minimum amount of cash that investors must keep on deposit, will fall to 10 percent from 15 percent from the first trading day of the month before delivery, the Shanghai exchange said in a statement on its website. The margin is also lowered to 20 percent from 40 percent for the last two days before the final trading day of the contract.

Margins for contracts are initially set at 7 percent from the day they are listed on the bourse, according to the statement. The changes will be effective from March 1.

“The exchange’s move is aimed at boosting trading at a time when volatility seems to have been tamed,” Zuo Xichao, manager at Beijing Antaike Information Development Co., said by phone from Changsha today. “Lower margin requirements will make these investments easier and more attractive because trading now requires less money to be locked up.”

Gold futures on the Shanghai exchange gained 3.4 percent in 2011, climbing for the third year, as the escalating debt crisis in Europe, slowing economic growth in the U.S. and rising inflation in China boosted demand. Still the yuan-denominated gold futures gained less than the 10 percent increase last year in the spot-delivery gold traded overseas.

The June-delivery contract in Shanghai gained 0.5 percent to 352.18 yuan a gram today.

--Feiwen Rong and Glenys Sim. Editors: Richard Dobson, Claudia Carpenter

To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at; Glenys Sim in Singapore at

To contact the editor responsible for this story: Richard Dobson at

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