Electricity Futures Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
What Are Electricity Futures? ●
Electricity futures are newly launched contracts on MCX, allowing traders to speculate or hedge electricity prices
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Just like trading gold or crude oil, now electricity is tradable as a financial asset
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Ideal for power producers, distributors, and even retail traders looking to manage price risks
Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
Why Trade Electricity on an Exchange? ●
Traditionally, power is sold via fixed-price Power Purchase Agreements (PPAs)
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These fixed contracts can’t adapt to changing market rates
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Electricity futures offer flexibility — enabling generators and discoms to hedge against price volatility
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Traded prices are often derived from the IEX Day-Ahead Market, offering more realistic and market-driven rates
Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
How Do Electricity Futures Work? ●
Cash-settled contracts — no physical delivery of power
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Based on IEX Day-Ahead Market prices
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Contract size: 50 MWh
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Tick size: ₹1 per MWh
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Every ₹1 move equals ₹50 gain/loss per contract
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Used for hedging or short-term speculation in energy markets
Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
Example of a Trade ● ● ●
Current electricity price: ₹4500/MWh You buy 1 contract at ₹4500 → Contract value = ₹2,25,000 Margin required: ₹22,500 (10%)
If price rises to ₹4510: ● You gain ₹500 (₹10 × 50 MWh) If price drops to ₹4490: ● You lose ₹500 (₹10 × 50 MWh)
Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
Disclaimer Investment in securities market are subject to market risks, read all the related documents carefully before investing. The securities quoted are for illustrative purposes and are not intended as recommendations. Brokerage will not exceed the SEBI prescribed limit. Navia Markets Ltd ,SEBI Registration No.INZ000095034-NSE Member code for CM, FAO & CD: 07708 - BSE Clearing No. for CM, FAO & CD: 6341-MCX Member ID: 45345 NSDL DP ID: IN300378-CDSL DP ID: 12086500-SEBI Registration No. for DP: IN-DP-311-2017-GST Registration number :33AAACM4739R2ZZ-Registered office: Ganga Griha, 4th & 5th Floor, No.9, Nungambakkam High Road, Chennai - 600 034 Email ID:
[email protected] - Contact No: +91 70100 75500 https://bit.ly/naviadisclaimer
Read blog - https://navia.co.in/blog/electricity-futures-a-new-trading-opportunity/
