Of late, investors have spotted a 'copper lining' to make a few quick bucks.
So they are discarding their obsession with gold and rushing for copper. According to market analysts, during the past 45 days copper has outperformed gold several times.
Gold has risen from Rs 9,290 on March 5 to Rs 9,530 by mid-April, a rise of 4%, while copper rose from Rs 268 on March 2 to Rs 330 by mid-April, a jump of 25%.
This reflected on the MCX contracts. Investors rushed towards copper, trading more than 11 lakh (1.1 million) contracts in March on MCX. And, during the last couple of days, the volume in the copper counter has surpassed gold.
Increase in China's copper imports has caused a price jump of 13.7% in March. Between January and March, investors got 19% returns from copper, while gold fetched them only 9%.
If you had bought one lot of gold in the start of March, it would have fetched you a profit of Rs 30,000 in mid-April. But if you had bought a lot of copper at that time, you would have been richer by Rs 60,000 by now.
However, China's resurgence of copper imports in the first two months of 2007 is unlikely to be sustained.
According to market analysts, much of the buying has been destined to replenish low stock levels. China's March-April refined imports may be much lower, at around 250,000 tonne for the two months. Premiums over spot prices in China by mid-March had fallen to about $12.91/tonne from more than $260/tonne in January.