Shanghai Gold Exchange launched Shanghai Gold Benchmark Price Trading on April 19, 2016. The term “Shanghai Gold Benchmark Price Trading” is a centralized pricing process that involves the issuance of various prices as per the corresponding buy and sell orders so that, by the end of multiple rounds of the trading process, the total buying volume and selling volume reach a relative balance and the orders are then matched and executed at the price, the Shanghai Gold Benchmark Price.
Detailed specifications of Shanghai Gold Benchmark Price Trading are hereby given as below:
1. The trading code of Shanghai Gold Benchmark Price Trading is SHAU. The quotation unit is in RMB/gram. The minimum price fluctuation is RMB 0.01/g. Trades shall be in multiple of lots, with each lot corresponding to 1 kg. The minimum quotation size is 1 lot; the maximum quotation size is 30,000 lots. T+2 delivery. Relevant product specifications are detailed with Product Specifications for Shanghai Gold Benchmark Price Trading.
2. The auction runs twice daily with the AM session begins at 10:15an and PM session at 2:15pm. There are five minutes for the issuance of reference prices and one minute for the display of Initial Price.
3. The Exchange will announce the Previous Benchmark Price on April 18 as the reference for price limit calculation of the first Shanghai Gold Benchmark Price Trading on April 19.
4. The transaction fee of Shanghai Gold Benchmark Price Trading will be exempted from April 19, 2016 to June 30, 2016.
5. Member shall file with the Exchange Application Form for Shanghai Gold Benchmark Price Trading. Currently the trading access is not open to individual customers.
6. Executed orders of Shanghai Gold Benchmark Price Trading will be cleared along with other SGE products under the same account. During the end-of-day clearing, the Exchange will clear positions in the sequence of price matching trades, Shanghai Gold Benchmark Price trades, and inquiry trades. Clearing orders and default determinations are detailed with Explanation of Default Determination Process of Margin Trading Products in Clearing System as per attached.
7. Traders with trading access to price matching system could use the same username, password, electronic certificate and certificate code to log in Shanghai Gold Benchmark Price Trading system. Members that connect to the Exchange through leased line shall provide their IP address to Technology Operation and Maintenance Department of the Exchange and grant access to firewall. International members could use SGEI Trading System directly. From April 7 to April 12, members could verify the connectivity to the production environment of Shanghai Gold Benchmark Price Trading system.
8. The terminal deployed in production environment is available on Shanghai Gold Benchmark Price Trading System Terminal Download page from the sector of Member Center – The Exchange’s Notice after login into the Membership sector on SGE’s website. International member do not need to download or install the software. As the stimulation environment of Shanghai Gold Benchmark Price Trading is still available after April 7, members shall distinguish production environment from stimulation environment when installing the terminal and use different terminals in case of disoperation.
At the occasion Aram Shishmanian, CEO, World Gold Council said, “The launch of the Shanghai Gold Benchmark represents another milestone both in the impressive development of the exchange and in the internationalisation of China’s gold industry. It is a stepping stone to a new multi-axis trading market consisting of London, New York and Shanghai and signals the continuing shift in demand from West to East. The World Gold Council continues to support the development of China’s gold market, and as the market expands to reflect the growing interest in gold by Chinese consumers, so too will China’s influence increase on the global gold market .”
Expressed Roland Wang, Managing Director, China, World Gold Council & said: “China needs a gold benchmark that reflects local market flows and reduces gold’s price dependency on the US dollar - so this is the ideal time for the Shanghai Gold Benchmark to launch. An Asian-focused, Yuan-denominated benchmark will significantly increase the liquidity and efficiency of the gold price discovery mechanism. The World Gold Council is honoured to witness this historic moment and the anticipated benefits it will bring to China and the global gold market.