Know about Commodity Trading India
You can trade in commodities and commodity derivatives at the commodity exchange in India. A commodity market trades in the economic sector. Investing in commodity is a good option for diversifying your portfolio.
You can trade in soft commodities like agricultural products or the hard commodities that can be mined. Agricultural products include wheat, coffee, cocoa, fruits and more. Products that can be mined include gold, silver, oil and more. You can trade in bullion, energy, metal and agro products in commodity trading India. The commodities exchange in India are
You can trade in soft commodities like agricultural products or the hard commodities that can be mined. Agricultural products include wheat, coffee, cocoa, fruits and more. Products that can be mined include gold, silver, oil and more. You can trade in bullion, energy, metal and agro products in commodity trading India. The commodities exchange in India are
- Multi commodity exchange (MCX)
- National spot exchange limited (NSEL)
- Indian commodity exchange limited (ICEX)
- National commodity and derivatives exchange limited (NCDEX)
- National Multi-commodity exchange of India (NMCE)
- Chamber of commerce - Hapur (COC)
- Ace derivatives and commodity exchange (ACE)
- Bhatinda Om & oil exchange ltd. (BOOE)
- Universal commodity exchange (UCX)
Commodity derivative
A derivative is a contract between two or more parties who value is based on underlying financial asset, index or security. The underlying assets include bonds, commodity, currency, interest rates, market indices and stock.
Commodity Trading India
The common derivatives in commodity trading are futures contract, forward contracts, options, swaps and warrants. Investors may benefit from the changing price in the underlying asset. Commodity derivative are used by the farmers to trade. A farmer may take a contract accepting the price of the commodity and the millers may enter the contract to supply the commodity. If the price rises the farmer will lose and if the prices of the commodity drop then the miler will have to pay more for the commodity.
Commodity derivative is an emerging investment getaway. The global market movement affects the commodity market.
Benefits of commodity trading
The benefits of commodity trading are
- It had lower margin and offers leveraged returns
- It is a hedge against inflation
- It is linked with international scenario
- It is a major portfolio diversification tool
The commodity market is driven by the basic economic principle of supply and demand. Lower supply drives up demand and which equals higher prices. This is how commodity trading works. Commodities can become risky as they get affected by weather patterns, epidemics and disasters.
Investors usually invest in gold which is viewed as a reliable with conveyable value. Another common investment is in energy. Crude oil is the main investment option in energy. A common way to invest in commodities is through a futures contract. Commodity trading is an essential business.
Investors usually invest in gold which is viewed as a reliable with conveyable value. Another common investment is in energy. Crude oil is the main investment option in energy. A common way to invest in commodities is through a futures contract. Commodity trading is an essential business.