InvestorQ : What does it mean when MCX extends negative pricing to all commodities? Does it mean that any commodity could have a negative settlement price?
Arusha Ray made post

What does it mean when MCX extends negative pricing to all commodities? Does it mean that any commodity could have a negative settlement price?

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Mary Joseph answered.
9 months ago
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Less than a month after the crude oil fiasco, MCX decided to extend negative pricing mechanism to all commodities futures contract by giving an exit option to traders if the prices enter negative zones. Effectively, MCX is offering an alternative exit opportunity to traders in all commodities if prices fall into negative zone. The exit will not be offered on the expiry day but on other trading days. The exit will be enabled through an auction held in a 15 minute window (11:40-11:55 pm) after market closing. This appears to be a preparation as now even natural gas is expected to slip into negative territory. BSE has already made changes to its software to allow negative pricing.

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