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 MCX: Lot Size, Tick Size & Profits:

The price of a financial instrument may vary based on the supply and demand for that financial instrument. In Trading, Tick size (Tick Movement, Tick Data) is the smallest amount a price can change when the market trend is up or down. You would have placed buy order or sell order but there may be no momentum, or more volatility or range bound for that financial instrument. You will not be sure whether you have to book profit or get out with loss. The following table will help you to know about the minimum amount a price has to increase/or decrease from your cost price so that you can get out with little profit/little loss.

The column Min Price Rs. serves as a bench mark for your profits and losses. On the trading terminal, you can see the prices quoted on "Quotation/Base Value" and not on "Trading Unit".

The below mentioned formulae in the table (Formula Table) will provide information about all columns and how they are linked to derive profits. If the market is range bound, you can do multiple transactions for the same product or multiple products and earn more profits.

  • Brokerage/Commission: We are assuming that .03% (.0003) is charged by your broker. Calculation’s accuracy is close to 100%.
  • Most of the prices mentioned are in rupees. For certain product like GOLDGUINEA, they may charge a flat fee. They may not charge brokerage charge of .03%.


Formula Table:

Commodity

Name of the Commodity

Trading Unit

Actual Trading Unit

Quotation/Base Value

Actual Quotation/Base Value

Lot Size (Qty)

Trading Unit Divided by Quotation/Base Value

Bought Price (Cost Price) Rs.

The Price that you bought

Sold Price Rs.

The Price that you sold

Min Price Rs.

The minimum price, it has to increase (LONG), or decrease (SHORT), so that you can get out with minimum profits.

Formula: Sold Price Minus Bought Price

Profit Rs.

The minimum profit.
Formula: ((Sold Price - Bought Price) * Lot Size) Minus ((Bought Price * Lot Size * .0003) + (Sold Price * Lot Size * .0003))

Tick Size Rs.

The minimum price, it will increase or decrease.

Tick Size (Example) Rs.

Example for tick price. Tick Size example is based on Bought Price for MCX and Sold Price for NCDEX.

In MCX Tick Size table, we have taken example as GOLD. Similarly you can do the calculation for all MCX PRODUCTS or NCDEX PRODUCTS.

Example: GOLD. If GOLD price has increased by 12 rupees, then you come out with minimum profits.

Trading Unit = 1 kilograms = 1000 grams
Quotation/Base Value: 10 grams
Lot Size = 1000 grams/10 grams = 100
Bought Price = 18400; Sold Price = 18412; Min Price = (18412 - 18400) = 12
Profit = ((18412 - 18400) * 100) Minus ((18400*100*.0003) + (18412 *100*.0003)
= ((12*) *100)) Minus ((552) + (552.36))
= (1200) Minus (1104.36)
=95.64


MCX Tick Size:

Commodity Trading Unit Quotation/Base Value Lot Size (Qty) Bought Price (Cost Price) Rs. Sold Price Rs. Min Price Rs. Profit Rs. Tick Size Rs. Tick Size (Example) Rs.
GOLD 1 kilogram 10 grams 100 18400 18412 12.00 95.64 Re. 1 per 10 grams 18399 or 18401
GOLDM 100 grams 10 grams 10 18400 18412 12.00 9.564 Re. 1 per 10 grams 18399 or 18401
GOLDGUINEA 8 grams 8 grams 1 18400 18412 12.00 0.9564 Re. 1 per 8 grams 18399 or 18401
 
SILVER 30 kilograms 1 kilogram 30 28000 28017 17.00 5.847 Re. 1 per kilogram 27999 or 27801
SILVERM 5 kilograms 1 kilogram 5 28000 28017 17.00 0.9745 Re. 1 per kilogram 27999 or 27801
 
LEAD 5 Tons (5000 kilograms) 1 kilogram 5000 90 90.1 0.10 229.85 5 paise per kilogram 89.95 or 90.05
LEADMINI 1 Ton (1000 kilograms) 1 kilogram 1000 90 90.1 0.10 45.97 5 paise per kilogram 89.95 or 90.05
 
ZINC 5 Tons (5000 kilograms) 1 kilogram 5000 90 90.1 0.10 229.85 5 paise per kilogram 89.95 or 90.05
ZINCMINI 1 Ton (1000 kilograms) 1 kilogram 1000 90 90.1 0.10 45.97 5 paise per kilogram 89.95 or 90.05
 
ALUMINIUM 5 Tons (5000 kilograms) 1 kilogram 5000 90 90.1 0.10 229.85 5 paise per kilogram 89.95 or 90.05
COPPER 1 Ton (1000 kilograms) 1 kilogram 1000 300 300.2 0.20 19.94 10 paise per kilogram 299.90 or 300.10
NICKEL 250 kilograms 1 kilogram 250 900 900.55 0.55 2.4587 10 paise per kilogram 899.90 or 900.10
CRUDEOIL 100 barrels 1 barrel 100 3500 3503 3.00 89.91 Re.1 3499 or 3501
NATURALGAS 1250 mmBtu per mmBtu 1250 200 200.2 0.20 99.925 10 paise 199.90 or 200.10




Loss, Brokerage for NCDEX Traded Products       NCDEX: Lot Size, Tick Size & Profits





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