The Golden Glow of India: A Financial Perspective

Abstract

Gold is a large Global business and represents the most liquid commodity market other than crude oil. These notes offer an overview of issues relating to Gold market and should be looked at as only information presented after the investigation of the structure of gold, trading as a futures contract on the NCDEX. In Part I, as an introduction to the precious metal Gold and its origin, a brief review of a prominent book on Gold and its history titled “The Ages of Gold” by Timothy Green is presented, Part II emphasizes on the demand and supply of gold in the world market with trend analysis, Part III emphasizes on aspects of the Gold Futures market, exchange trading of Gold futures with an overview of the now familiar GARCH properties (autoregressive conditional heteroscedasticity). Part IV emphasizes on a the Indian gold futures market and illustrates a rarely used measure in the capital markets–the Garman Klass estimator – is used to provide new insights in intraday and interday gold counter dynamics. As part of the closing remarks an executive summary is presented encompassing latest data on gold from a Global perspective. Scope for further research – Trend analysis of the Indian Gold futures market in the backdrop of the more mature American market would result in better forecasting of prices and demand.