How is the price of Gold and Silver calculated in India? Read more to find out.
Gold and Silver are commodities. Commodities are distinct from stocks and bonds. Commodities consist of energy (Oil and Gas), metals (Gold and Silver), livestock and meat (Cattle) and Agricultural (Rice, Wheat, Sugar, etc.). Since the products are of a different type, commodities are not traded in the stock market. Commodities like Gold and Silver are traded in MCX.
What is MCX?
MCX stands for Multi Commodity Exchange. It is an exchange for trading commodities. Along with Gold and Silver, other precious metals plus agricultural commodities like cotton and coffee, etc. can be purchased/sold at the MCX.
What is MCX Gold Price?
The price of Gold and Silver in India depends on a lot of international factors. The price of Gold and Silver is not calculated at the MCX. The MCX price is dependent on:
- International price
- USD to INR conversion rate
- Quoted unit of Gold or Silver
- Troy ounce to Grams conversion
- Supply and demand of Gold and Silver in MCX trading
How to calculate Gold Price?
There is a standard formula for calculation of MCX Gold price.
- Gold Price calculation formula for 1 gram = (International Gold Price) x (USD to INR Conversion Rate) / (Troy Ounce to Grams Conversion)
How to calculate Silver Price?
There is a standard formula for calculation of MCX Silver price.
Silver Price calculation formula for 1 gram = (International Silver Price) x (USD to INR Conversion Rate) / (Troy Ounce to Grams Conversion)
MCX Gold price is quoted in INR for 10 grams and Silver is quoted in 1 Kg. International Gold/Silver price is quoted in troy ounce.
Now that you know how Gold and Silver rate is calculated in MCX, you can simply use the formula and find the latest value.