Gold guide

Gold trading is not gold investing

Futures and options track the metal but behave nothing like holding it: margin instead of payment, daily mark-to-market instead of ownership, expiry instead of tenure. Read this page risks-first.

Compare with holding an ETF Brokers with derivatives access

Gold futures

A contract to buy or sell a fixed quantity of gold at a future date. You post margin rather than paying the full value, so a small move in gold moves your money a lot. Exchange contract specifications set lot sizes; mini and micro variants carry a smaller notional.

Trading instrument. Leverage, expiry and margin calls make the risk profile different from holding gold.

Costs

Brokerage and exchange, SEBI, stamp and GST charges per trade.
Bid-ask spread on entry and exit.
Funding/margin costs if you carry leveraged positions.

Risks

This is a trading instrument. Leverage, expiry and margin calls make its risk profile materially different from simply holding gold.
Leverage magnifies losses as well as gains — you can lose more than the initial move suggests.
Daily mark-to-market can force you to add funds at the worst time.
Contracts expire; a held position must be rolled or squared off.

Liquidity: The near-month contract is usually the most liquid; far months and mini/micro variants are thinner.

Gold options

An option gives you the right, but not the obligation, to buy or sell a gold contract at a set price before expiry. You pay a premium for that right. It is a trading and hedging instrument, not a way to accumulate gold.

Trading instrument. Leverage, expiry and margin calls make the risk profile different from holding gold.

Costs

Premium paid up front.
Brokerage plus statutory charges on every leg.
Bid-ask spread, which widens in far-dated or thinly traded strikes.

Risks

This is a trading instrument. Leverage, expiry and margin calls make its risk profile materially different from simply holding gold.
The entire premium can be lost if the move does not happen in time.
Time decay works against a position that is simply held.
Exercise or assignment can create an obligation you did not intend.

Liquidity: Concentrated in near-month, near-the-money strikes; the rest is thin.

Contract sizes

Standard, mini and micro

The exchanges list smaller-sized gold contracts alongside the standard lot so smaller traders can take smaller notional exposure. Sizes, margins and expiries are set by the exchange and change — check the current MCX/NSE contract specifications before trading, not this page.

Smaller notional, same mechanics. Mini and micro contracts reduce the rupees per point move, not the leverage, expiry or mark-to-market structure.
Liquidity concentrates at the front. The near-month contract is usually deepest; far months and smaller variants are thinner, so exits cost more.
You need a demat account with derivatives access, activated segments, and margins maintained daily — a setup cost in both money and attention that holding gold never asks for.

Tax

Usually business income, not capital gains

Exchange-traded derivatives are generally treated as business income taxed at slab rates rather than under the capital-gains framework that covers ETFs, funds and jewellery. Framework only, and not filing advice — confirm your position with a tax adviser.

Framework facts reviewed 2026-09-20. SEBI-regulated exchange-traded commodity derivatives (MCX/NSE) — regulation governs the market structure, not your returns. See our methodology.