By Debbie Carlson
Kitco News
There’s been much chatter in gold markets about the size of Comex precious metals warehouse stocks and what this may mean for the market, but much of that chatter is at best misinformed, say veteran futures traders.
The chatter surrounds the size of gold futures positions limits and open interest versus warehouse stocks and how they aren’t equal. However, the chatter doesn’t understand how the futures market operates, market participants said.
The current size of warehouse stocks is around 7.8 million ounces, and total open interest for the full-sized gold futures contract was 408,535 contracts as of Thursday. One contract is 100 ounces. And while open interest, which represents the number of positions available to trade, is larger than warehouse stocks, they do not have one-to-one relationship.