Home |About Us | Sitemap | Feedback here | 200 dma of stocks | Master List of All Stocks
Commodity trading:
| Links under this site |
|
Cash Stocks Future Stock Gold & Silver charts Commodity Trading Option Strategies |
Commodity trading
in India is regulated by the Forward Markets Commission (FMC)
headquartered at Mumbai, it is a regulatory authority which is overseen by the
Ministry of Consumer
Affairs and Public Distribution, Govt. of India. It is a statutory body set up
in 1953 under the Forward Contracts (Regulation) Act, 1952.
After equity trading, commodity trading is going to
be the next big thing for investors. In India people have a love for Gold and
Silver, trading is also going to pick up in Gold and Silver. Globally, the commodity trade
market is about three times the size of equities trade market. In India,
presently, the commodities market is still in a nascent stage and is gradually
picking up taking a cue
from global markets.
| Topics |
| Nasdaq
and Dow Old Economy Stocks Software stocks Pharma Stocks PSU Stocks Information |
| Commodity: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Any goods that are unbranded and are commonly traded in the market come under commodities. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commodity trading | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Commodity markets are quite like equity markets. The commodity market also has two constituents i.e. spot market and derivative market. In case of a spot market, the commodities are bought and sold for immediate delivery. In case of a commodities derivative market, various financial instruments having commodities as underlying are traded on the exchanges. It has been seen that traditionally in India people have hedged their risks with Gold and Silver. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commodities future | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Commodity future is a derivative instrument for the future delivery of a
commodity on a fixed date at a particular price. The underlying in this case is
a particular commodity. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Benefits of Commodities Futures: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
To producer: A producer of a commodity can sell the futures of the
commodity, thereby ensuring that he can sell a particular quantity of his
commodity at a particular price at a particular date. To commodity trader: A commodity trader can use these to ensure that he is protected against any adverse changes in the prices. He can enter into a futures contract for purchase of a certain quantity of the underlying at a particular price on a particular date, or he can enter into a futures contract for sale of a particular quantity on a particular date at a particular price and be assured of the margins because both his purchase price as well as the sale price are fixed. Traders do a good arbitrage in Gold and Silver. Whenever they find Gold moving up, they short silver and similarly whenever they find silver moving up and gold likely to move down, they hedge. To exporters: Future trading is very useful to the
exporters as it provides an advance indication of the price likely to prevail
and thereby help the exporter in quoting a realistic price and thereby secure
export contract in a competitive market. Having entered into an export contract,
it enables him to hedge his risk by operating in futures market.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
List of exchanges and their respective traded commodities is given below: |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
Copyright stockmarketmessages.com., All rights reserved world wide