Copper Futures are standardised, Exchange Traded Derivatives Contracts that give investors the right to buy or sell the underlying Commodity at a fixed price on a future date. In essence, this product exposes local investors to the international copper market through referencing benchmark settlement prices as determined on the New York Mercantile Exchange (NYMEX) through its Commodity Exchange (COMEX) division, a subsidiary of the CME Group. Contracts are priced and settled in rands and can easily be accessed via JSE Commodity Derivatives and Equity derivatives members.
Who is this for?
Copper Futures are hedging tools that offer copper price mitigation opportunities to a range of market participants. The contracts can also be used by speculators hoping to make a profit on short-term movements or benefit from the spread opportunities between the local and international market.
- Copper Futures provide global price discovery and opportunities for portfolio diversification;
- Provides easy access to the international market and identification of short-and-long term price and volatility patterns of copper;
- Effective price risk management and evaluation of both current and future world supply and demand;
- Hedge or gain exposure based on expectations of directional price or volatility;
- The risk of loss given local and global environmental and socio-economic factors which can significantly impact the price of commodities.
How to get it
To access Copper Futures and Options, investors need to register as a client with an authorised member firm, deposit the required initial margin and sell or buy according to their needs. To access this product, contact one of the commodity derivatives members
- No limits apply to individuals, foreigners or corporate entities;
- Pension funds and long term insurance companies subject to their 25% foreign allocation limits;
- Asset managers and registered collective investment schemes subject to their 35% foreign allocation limits;
- For the full details relating to qualifying factors, speak to your broker.