As the name suggests, GUAREX is a return based index tracking the price movement in the futures contracts of its guar seed and guar gum refined splits on a real-time basis. Similarly, SOYDEX will follow the price changes in futures contracts of soybean and refined soy oil.
“GUAREX and SOYDEX are the country’s first sectoral indices in the agri-commodities space,” said Mr. Arun Raste, managing director and CEO, NCDEX.
Initially, both the indices will be available on the exchange’s website and will be representative only to gauge the performance of Guar complex and Soy complex. The futures trading in these indices will be launched in due course.
The weightage of guar seed and guar gum refined splits in GUAREX is 63.43 per cent & and 36.57 per cent, respectively. In SOYDEX, soybean and refined soy oil will have the weightage of 67.92 per cent and 32.08 per cent, respectively.
“I have no doubt that these indices will soon be positioned as benchmarks in their respective areas. GUAREX and SOYDEX will offer a lot of opportunities to value chain participants with respect to trading strategies and risk management exercises,” said Mr. Kapil Dev, Chief Business Officer, NCDEX.
“Being cash-settled contracts, GUAREX and SOYDEX become perfect products for hedgers who have been in a constant search for low-cost products. SEBI‘s cross margin benefit will further sweeten the deal for hedgers in terms of significant reduction in the transaction by using GUAREX and SOYDEX,” Mr. Dev said.
In May 2020, NCDEX had launched AGRIDEX, a return-based composite index tracking futures price movement in 10 commodities on NCDEX. The index has given over 40 per cent return in its first full year of operations, establishing itself as a benchmark for the commodity market participants.