What Is a Deferral Fee?

The extension fee, also known as the extension compensation fee, is a rule specified by the Shanghai Gold Exchange in order to balance the settlement market. The extension fee is the financing cost of the customer's deferred settlement or the physical financing of gold. The payment direction of the deferred fee is determined based on the comparison of the number of settlement declarations. When the delivery declaration amount is less than the receipt declaration amount, the short position pays an extension fee to the long position; when the delivery declaration amount is greater than the receipt declaration amount, the long position pays an extension fee to the short position; when the delivery declaration amount is equal to the receipt There is no extension fee payment when reporting the amount.

Extension fee

Extension fee =

The extension fee for Au (T + D) contract and Ag (T + D) contract will be collected and paid according to the natural day, and holidays will be based on the previous holiday.

According to the data analysis of the Oriental Silver Network Research Center,

In 2012, the extension fee will be overpaid by 225 trading days and by 18 additional trading days;

Calculating 243 trading days, the short pay is 225; 92.59% overpay short;

The actual extension fee is 366 days in a year; the short payment is 342, and the short payment is 24 more; 93.44% is the short payment.

To calculate specifically, pay more for the empty extension fee: 6.14%, 0.47% more for the empty payment; actual income: 5.67%;

Silver TD leverage is 5-7 times, Tiantong Silver leverage is 5-12.5 times; Tiantong Silver can also lose 50% of the margin, even if 3-5 times leverage income is 17-28.35

The paper and silver arbitrage operation yields more than 10% in one year.