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Commodity Markets


The next precious metal after Gold which we will discuss here, is Silver.


Silver (Chemical Symbol-Ag) is a brilliant grey-white metal that is soft and malleable. The main source of silver is lead ore. The sources of silver include coin melt, scrap recovery, and dis-hoarding from countries where export is restricted.


Silver is unique amongst metals because it can be classified as both a precious metal and an industrial metal. Nearly 60% of India's silver demand comes from farmers and rural India. Today, silver is sought as a valuable and practical industrial commodity and as an investment.


Silver is an important element of global monetary reserves, and is considered to be an effective portfolio diversifier.



Factors Affecting Silver:


1.Economic events such as national industrial growth, global financial crisis, recession, and inflation all affect silver prices.


2.Commodity-specific events such as the construction of a new production facility, unexpected mine or plant closures, or industry restructuring, also affect silver prices.


3.Government-set trade policy (implementation or suspension of taxes, penalties, and quotas), affect the supply of silver prices.


4.Geopolitical events involving governments or economic paradigms and armed conflict can cause major changes to the prices and supply of silver.


5.Faster growth in demand against supply often leads to a drop in stocks with the government and investors.


6.Silver demand is underpinned by the demand from jewelry and silverware, industrial applications, and overall industrial growth.


7.In India, the real industrial demand occupies a small share in the total industrial demand for silver. This is sharp in contrast to most developed economies.


8.In India, silver demand is also determined to a large extent by its price level and volatility.


Top Producers of Silver:


Silver Price Movement:


Trading and Conversion:

  • Silver is predominantly traded on the London Bullion Market Association (LBMA) and COMEX in New York.
  • Silver is invariably quoted in US dollars per troy ounce.
  • Contract specification on MCX:
    * Symbol: SILVER
    * Trading Unit: 30kg
    * Maximum order size: 600kg
    * Tick Size: Re.1 per kg
  • Conversion factor: 1 kilogram = 32.15 troy ounce.
  • Conversion Calculation: Comex Silver price * 32.15 * INR Currency.
    Example: Comex Silver future stands at 14.040 and INR Currency is at 49.6200, the price for 1 kilogram =₹14.040 * 32.15 * 49.6200.
    = ₹22398.29/kilogram.

Apart from the primary silver contract, there are 2 other silver contracts available on the exchanges:


1.Silver Mini

  • Symbol: SILVERM
  • Trading unit: 5 kg
  • Maximum order size: 600 kg
  • Tick Size: ₹ 1 per kg

2.Silver Micro

  • Symbol: SILVERMIC
  • Trading unit: 1 kg
  • Maximum order size: 600 kg
  • Tick Size: ₹ 1 per kg

All the silver contracts mentioned above trade on MCX. 


The timing of the exchange is Monday to Friday: 09:00 A.M. to 11:30 P.M.


These contracts differ from each other in terms of prices and liquidity, just like gold contracts.



Out of all the 4 silver contracts, Silver and Silver mini are the most actively traded.

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