Commodity market, one of the oldest market in human history, is a place where trading of commodities takes place. It is similar to an equity market, but instead of buying or selling shares, one buys or sells commodities. Commodity market offers as much an opportunity to investors as does the stock market.
World-over one will find that a market exists for almost all the commodities known to us. These commodities can be broadly classified into the following:
The commodities market exists in two distinct forms, namely, the Over the Counter (OTC) market and the Exchange-Traded market.
The Exchange-Traded markets are essentially only derivative markets and are similar to equity derivatives in their working. That is, everything is standardized and a person can purchase a contract by paying only a percentage of the contract value. A person can also go short on these exchanges.
Also, even though there is a provision for delivery most of the contracts are squared-off before expiry and are settled in cash. As a result, one can see an active participation by people who are not associated with the commodity.
There are two big exchanges in India namely; MCX & NCDEX which we at Nai Nath Commodities Pvt. Ltd. offer to deal in….
MCX Reg. No.: MCX 28160/NCDEX Reg.No.00480 | SEBI Registration No.: INZ000079234