Operations
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Trading:
MCX employs state-of-the-art, new generation integrated trading platform that permits faster and efficient operations in a cost effective manner. The Exchange Central System is located in Mumbai, and maintains the Central Order Book, which matches the trades on a pre-defined matching algorithm, and confirms the execution of trades to the members on an online real-time basis. It has an integrated Surveillance and Settlement System. Exchange members located across the country are connected to the central system through VSAT, Leased line, Internet or any other mode of communication as permitted by the Exchange. The Exchange also has a Disaster Recovery Site

Risk Management:
The central objective of MCX's Risk Management System is to assess and manage the risk of the market in an expeditious manner to ensure smooth and timely pay-in/ pay-out process of the Exchange. Some of the basic functions of Risk Management are as follows –

  • Real-time Margining System at client level
  • Monitoring of position limits (Quantity)
  • Capital adequacy norms
  • Daily price limits
  • Initial margins
  • Special margins
  • Marked-to-market margin
  • Delivery period margin

Clearing and Settlement:
The Clearing and Settlement System of the Exchange is system driven and rule based. The Exchange has its own in-house clearing house, which undertakes to clear each and every trade and is counter-party for all trades; thus offering novation (zero counter-party risk) to each and every trade executed on the Exchange

Clearing Bank Interface:
Exchange maintains electronic interface with its Clearing Banks. All members of the exchange have their Settlement and Client Accounts for exchange operations with the Clearing Bank. All debits and credits are effected electronically through Settlement account only.

Delivery and Final Settlement :
All contracts on maturity are for delivery. MCX specifies tender and delivery periods. For example, such periods can be from the 8th working day till the 15th day of the month - where 15th is the last trading day of the contract month - as tender and/ or delivery period. A seller or a short open position holder in that contract may tender documents to the exchange expressing his intention to deliver the underlying commodity. The exchange would then select the buyer from the long open position holder for the tendered quantity. Once the buyer is identified, seller has to initiate the delivery process and the buyer has to take delivery according to the delivery schedule prescribed by the exchange.