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In a move to attract small private investors, China on Monday lowered the trading threshold at the Shanghai Gold Exchange (SGE) from one kilogram to 100 grams.
SGE sources said 100-gram gold bars, which debuted on Monday at an initial price of 160 yuan (20.5 U.S. dollars) per gram, started spot trading at an opening price of 157 yuan per gram and then remained flat for the entire trading session, closing at 157 yuan per gram, a drop of three yuan.
During Monday's trading, only 0.4 kg or four gold bars of this type changed hands, and transactions amounted to only 62,800 yuan.
However, business was brisk for other types of gold. 2,359 kg of two other conventional types of gold were traded and 1,506 kg of gold listed for trading delay (T+D).
An SGE spokesman blamed the poor market performance of the newly premiered 100-gram gold bars on a the Christmas holiday season.
Industry experts still believe China's latest move will help diversify gold investment channels in the country and standardize the market for gold transactions.
In July last year the SGE proposed spot trading of gold by private investors in cooperation with the Industrial and Commercial Bank of China (ICBC). However, the one-kg 160,000 yuan (20,000 US dollars) threshold turned off many private investors.
The volume of spot transactions by private investors in the first ten months accounted for just 0.57 percent of total trading.
The Provisional Measures Regarding the Administration of Spot Trading of Gold by Private Investors published by the SGE stipulate a private investor can participate in spot trading and even claim gold at designated warehouses in Shanghai, Beijing and Shenzhen via any SGE financial members or other agents approved bythe People's Bank of China.
SGE will charge private investors a fee of 0.06 per cent plus commissions with a maximum of 0.15 per cent, say the provisional rules.
Wong Hasang, a native of Hong Kong and chairman of the board ofGuizhou Xixibao Mining Co., said the lower SGE threshold would lure more small private investors to spot trading of gold but that he himself was not interested for the time being.
"Investing in gold is not for the faint-hearted," said Wong. "You need to have a speculative frame of mind because the risk in investing in gold is high." Wong said he followed the gold market assiduously because many of his friends in Hong Kong invest in gold.
Cheng Fumin, president of the China Gold Association, said sales of gold had risen since the beginning of the year.
Sales of gold bullion and gold bars account for more than one tenth of gross gold consumption in China.
"I think more investors will be attracted to spot trading and the number of transactions will increase as the SGE opens its doors wider," said Cheng.
China's gold market is currently restricted to spot trading, but the SGE has been developing derivatives such as futures, options and investment funds.
Cheng predicted the country's gold output would exceed 240 tons this year, with gold sector profits topping 5.5 billion yuan,a record high.
The country produced 169.28 tons of gold in the first three quarters of the year, a rise of 12.62 tons on the same period last year, and raked in 3.9 billion yuan (about 487 million U.S. dollars) in pre-tax profits, up 52 percent on comparable figures from last year.
China now ranks third in the world in terms of gold consumption, after India and the United States.
Song Yuqin, deputy general manager of SGE, said Chinese people are fond of gold and are keen to keep gold as an asset.
Gold consumption exceeded 300 tons in China last year, 81 percent of which went to the jewellery-making sector. |
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發表於 2006-12-26 14:37:32
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