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Gold Futures and Options

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Gold futures are hedging tools for commercial producers and users of gold. They also provide global price discovery and opportunities for portfolio diversification. In addition, they offer ongoing trading opportunities, since gold prices respond quickly to political and economic events and serve as an alternative to investing in gold bullion, coins, and mining stocks

  1. Gold Futures: Things to know about the contracts:

1. Physically delivered Block-trade eligible American-style options

2. Can be traded off-exchange for clearing only through CME ClearPort

Gold Futures - About Gold

Since ancient times gold has been coveted for its unique blend of rarity, beauty, and near indestructibility. Nations have embraced it as a store of wealth and a medium of international exchange, and individuals have sought to possess it as insurance against the day-to-day uncertainties of paper money.

Following the California gold discovery of 1848, North America became the world's major gold supplier. From 1850 to 1875, more gold was discovered here than in the previous 350 years. By 1890, the gold fields of Alaska and the Yukon were the principal sources of supply and, shortly afterwards, discoveries in the African Transvaal indicated deposits that exceeded even these. Today, the principal gold producing countries include South Africa, the United States, Australia, Canada, China, Indonesia, and Russia.

Gold is a vital industrial commodity. It is an excellent conductor of electricity, is extremely resistant to corrosion, and is one of the most chemically stable of the elements, making it critically important in electronics and other high-tech applications.

Gold Futures and Options Contract Specifications

Gold Futures

Product Symbol GC
Venue CME Globex, CME ClearPort, Open Outcry (New York) (New York)
Hours
(All Times are New York Time/ET)
CME Globex: Sunday - Friday 6:00 p.m. - 5:15 p.m. (5:00 p.m. - 4:15 p.m. Chicago Time/CT) with a 45-minute break each day beginning at 5:15 p.m. (4:15 p.m. CT)
CME ClearPort: Sunday - Friday 6:00 p.m. - 5:15 p.m. (5:00 p.m. - 4:15 p.m. Chicago Time/CT) with a 45-minute break each day beginning at 5:15 p.m. (4:15 p.m. CT)
Open Outcry: Monday - Friday 9:00 AM to 2:30 PM (8:00 AM to 1:30 PM CT)
Contract Size 100 troy ounces
Price Quotation U.S. Dollars and Cents per troy ounce
Minimum Fluctuation $0.10 per troy ounce
Termination of Trading Trading terminates on the third last business day of the delivery month.
Listed Contracts Trading is conducted for delivery during the current calendar month; the next two calendar months; any February, April, August, and October falling within a 23-month period; and any June and December falling within a 60-month period beginning with the current month.
Settlement Type Physical
Delivery Period Delivery may take place on any business day beginning on the first business day of the delivery month or any subsequent business day of the delivery month, but not later than the last business day of the current delivery month.
Grade and Quality Specifications Gold delivered under this contract shall assay to a minimum of 995 fineness.
Position Limits NYMEX Position Limits
Rulebook Chapter 113
Exchange Rule These contracts are listed with, and subject to, the rules and regulations of NYMEX.

Gold Futures Options

Underlying Futures Gold Futures
Product Symbol OG
Venue CME Globex, CME ClearPort, Open Outcry (New York) (New York)
Hours
(All Times are New York Time/ET)
CME Globex: Sunday - Friday 6:00 p.m. - 5:15 p.m. (5:00 p.m. - 4:15 p.m. Chicago Time/CT) with a 45-minute break each day beginning at 5:15 p.m. (4:15 p.m. CT)
CME ClearPort: Sunday - Friday 6:00 p.m. - 5:15 p.m. (5:00 p.m. - 4:15 p.m. Chicago Time/CT) with a 45-minute break each day beginning at 5:15 p.m. (4:15 p.m. CT)
Open Outcry: Monday - Friday 8:20 a.m. - 1:30 p.m. (7:20 a.m. - 12:30 p.m. CT)
Contract Size One COMEX Gold futures contract
Option Style American
Minimum Fluctuation $0.10 per troy ounce
Expiration of Trading Trading terminates on the fourth business day prior to the underlying futures delivery month.  If the expiration day falls on a Friday or immediately prior to an Exchange holiday, expiration will occur on the previous business day.
Listed Contracts Trading is conducted in the nearest six of the following contract months:  February, April, June,  August, October, and December.  Additional contract months - January, March, May, July, September, and November - will be listed for trading for a period of two months.  A 60-month options contract is added from the current calendar month on a June-December cycle.
Strike Prices $10.00 per ounce apart for strike prices below $500, $20.00 per ounce apart for strike prices between $500 and $1,000, $50.00 per ounce apart for strike prices above $1,000. For the nearest six contract months, strike prices will be $5.00, $10.00, and $25.00 apart, respectively.
Settlement Type Exercise into futures
Delivery Period Delivery may take place on any business day beginning on the first business day of the delivery month or any subsequent business day of the delivery month, but not later than the last business day of the current delivery month.
Grade and Quality Specifications Gold delivered under this contract shall assay to a minimum of 999 fineness.
Position Limits NYMEX Position Limits
Rulebook Chapter 115
Exchange Rule These contracts are listed with, and subject to, the rules and regulations of NYMEX.

See also: Gold News Blog,  Gold Futures Options Trading Special Report, Silver Futures,Copper Futures, Platinum Futures, Palladium Futures