Axis Securities Introduces Trading in MCX Commodity Derivatives for its Customers
· Banks led Broking firms currently contributes to around 30 - 40 percent of Equity customer base. With Bank brokers allowed to trade in Commodities, similar contribution may be seen in commodity markets going forward. In the next 2-3 years, they are expected to increase the commodity market volumes by at least 15 - 20 percent said Mr. Mrugank Paranjape, MD & CEO, MCX · Axis Securities with close to 20 Lakh customers is the first bank led broking firm taking a lead to launch the commodity derivatives trading on its platform (www.AxisDirect.in) truly exposing commodities to retail customers. Currently MCX has around 26 Lakh UCC (Unique Client Codes) and this reach is poised for a higher growth with Bank led brokers like Axis Securities · Axis Securities has also launched zero brokerage for First Week of launch thereby encouraging it's customers to experience the new platform. Axis Securities will also handhold retail customers by organising various training programs through their research teams, dealers and relationship manager
Pune : Axis Securities Ltd. (ASL), one of the leading stock broking houses and a subsidiary of Axis Bank, has become the first bank subsidiary to introduce to their customers trading in commodity derivatives on the Multi Commodity Exchange of India Ltd. (MCX), India’s No. 1 commodity exchange, which has a market share of over 90 per cent. The trading will be introduced under its flagship brand-Axis Direct.
This is a major development ever since the Hon’ble Finance Minister Shri Arun Jaitley in his Budget 2017-18 proposed the further integration of commodities and securities derivative markets by integrating the participants, brokers and operational frameworks. Later, the Securities and Exchange Board of India in September 2017 allowed brokers of stocks and commodity derivatives market to do both businesses under a single entity. After Reserve Bank of India (RBI) permitted bank subsidiaries to provide broking services in commodities derivatives, ASL became the first ever bank sponsored broking entity to take membership of a commodity exchange.
With this launch, Axis Direct has expanded its overall investment product bouquet that currently includes Equities, Mutual Funds, SIPs, IPOs, Derivatives, Bonds, NCDs, ETFs, Company Fixed Deposits and Overseas Trading. All existing and new Axis Direct customers can now trade in 29 commodity futures and 5 options contracts, covering bullion, industrial metals, energy and agricultural segments, simply through a one-time online registration process. Within 48 hours of providing the online request, the customer will be provided rights to trade in commodity derivatives. Once the commodity rights are enabled, the customer can use the same login credentials of Axis Direct and access commodities platform with streaming market watch with real-time market information.
Commenting on the launch Mr. Arun Thukral, MD & CEO, Axis Securities said, “We are extremely happy to be the first Bank led brokerage firm to launch Commodity Derivatives Trading for our customers. The move to allow Bank led brokers to offer commodity derivatives will not only expand the market volumes significantly but will also increase retail customer participation. Trading in commodities can be an important way to diversify a portfolio beyond traditional equities – either for the long-term or as a place to park cash during unusually volatile or bearish stock markets, as commodities traditionally move in opposition to stocks. With the launch of Commodities Derivatives, we have expanded the choice for derivative traders to choose a wide spectrum of commodities, index or equity as an underlying.
Speaking on the occasion Mr. Mrugank Paranjape, MD & CEO, MCX said, “I am very happy that Axis Securities has become the first bank-owned broking firm to start distribution of commodity derivatives. With its large client base, supported by its huge branch network, superior research and above all, the goodwill it has generated among the public, I am sure Axis Securities will enable commodity derivatives trading reach to a very large number of potential customers across the country. Such an access to the hitherto excluded class of participants will surely enhance the breadth and depth of the market.
About Axis Securities Ltd:
Axis Securities Ltd. (ASL) is a proud subsidiary of Axis Bank India’s 3rd largest private sector bank. ASL is currently present in 80+ branches across India. ASL offers retail broking services under its flagship brand AxisDirect and also functions as a distributor to Bank’s financial products. AxisDirect engages in offering simplified investment solutions to the customers. With over 19 lakh customers, AxisDirect is one of the fastest growing players in the industry and is among the top 3 players in terms of total customer base.
Having commenced operations on November 10, 2003, Multi Commodity Exchange of India Limited (MCX) is India’s first listed, national-level, electronic, commodity futures exchange with permanent recognition from the Government of India. It is also the first exchange to introduce commodity options in India. In the financial year, 2017-18, the market share of MCX was 89.58%.. MCX offers the benefits of fair price discovery and price risk management to the Indian commodity market ecosystem. Various commodities across segments are traded on the Exchange platform. These include bullion, energy, metals and agri-commodities. The exchange has forged strategic alliances with various international exchanges, as well as Indian and international trade associations.