SILVER

Lot size: One contract represents 30 kilograms.

Tick size: Minimum price movement is Re. 1 per kg.

Quotation: Prices are quoted in rupees per kilogram.

Expiry: Contracts expire on the 5th day of the contract expiry month. If that day is a holiday, the preceding working day. New contracts launch on the 16th day of the launch month.

Trading hours: Standard trading hours run Monday through Friday, 9:00 AM to 11:30 PM. During periods of US daylight saving time, the closing time shifts to 11:55 PM.

Daily Price Limit (DPL): The initial circuit breaker sits at 4%. If breached, the limit widens to 6% without a cooling-off period. If 6% is breached, a 15-minute pause follows before expanding to 9%.

Initial margin: Minimum 10% or SPAN-based, whichever is higher. Extreme loss margin applies on top.

Open Interest (OI): Total outstanding contracts across all participants. Rising OI with rising price indicates fresh long positions. Rising OI with falling price indicates fresh shorting.

Position limits: Individual clients can hold up to 100 MT or 5% of market-wide OI, whichever is higher, for all Silver contracts combined. Members can hold 1,000 MT or 20% of market-wide OI.

Maximum order size: 600 kg per order.

Delivery: Compulsory delivery at expiry. The primary delivery centre is Ahmedabad. Additional centres are Mumbai and Delhi. The quality standard is 999 fineness. LBMA-approved suppliers are mandatory.

Macro participation without physical exposure: Silver prices are influenced by central bank policies, currency fluctuations, and geopolitical events. Using futures gives traders an opportunity to take advantage of these price fluctuations without the need to rely on physical bars.

Leverage through margin: Only a margin payment is required for futures. This means lower investments in the markets. It is also an opportunity to create a margin until it is managed.

Hedging utility for jewellers and bullion dealers: Companies with silver price risk exposure can use MCX futures to manage input costs. The compulsory delivery design supports this operational hedging.

Transparent, regulated infrastructure: MCX is an exchange regulated by SEBI. The prices are displayed publicly. Settling takes place in accordance with a set of rules. The clearing house lowers the counterparty risk.

Physical delivery option: Compulsory delivery at expiry ensures convergence between futures and spot. Sellers deliver 999 fineness silver. Buyers receive LBMA-approved bars with quality certification.

Portfolio diversification: Silver prices often move inversely to equities and bonds. The introduction of SILVER futures into a portfolio can lower general volatility and offer protection against systemic risks.

Track US Federal Reserve policy: The dollar's interpretation is propped up by rate decisions and forward guidance, which has a trickle-down effect on silver. Pay attention to statements by the FOMC, dot plots, and press conferences.

Follow the USD/INR in conjunction with the London spot: The rupee dollar rate affects the price of MCX. A weaker rupee helps the domestic economy even though London currency rates remain unchanged.

Factor in Indian festival demand: The wedding season and year-end buying boost physical demand. This can cause MCX prices to climb and remain above London prices.

Monitor the central bank buying reports: The World Gold Council shares information on countries building up their stores of precious metals every quarter. Resilient buying sets bottomed-up price floors.

Account for daily MTM and margin calls: MCX settles profits and losses every evening. Silver has a tendency to gap when geopolitical events or central bank surprises occur. Scale your trading choices to resist trading calls. Do not size based on the minimum margin alone.

Use multiple time frame charts: The trend that can be seen on the daily SILVER futures chart can differ from the hourly trend. Dhan's custom and India timeframes let you align both before entering.

Use the Dhan Trade Plan for position sizing: Trade Plan is a built-in tool on Dhan Charts. Input your capital allocation percentage, risk percentage, and reward percentage. It calculates your exact quantity, stop-loss level, and target price automatically.

Square off before expiry if you do not want delivery: Most retail traders do not intend to take or give physical delivery. Exit well before the last trading day to avoid compulsory delivery obligations.

Size positions within capital limits: The ability to take a large position with a small margin is not a reason to do so. Keep single-trade risk within a defined percentage of your total capital. Use the Trade Plan to enforce this discipline.