Commodity trading has a very old history in India. In fact, the practice of trading in commodities started in India much earlier than in most other countries. However, years of foreign rule, periods of commodity scarcity, and lack of proper Government policies caused the commodity market somehow diminished in India. But that has become past as well. Hopefully, commodity market was recently given a huge boost in India. A regulatory body called the Forwards Markets Commission (FMC) was set up as early as 1953. As of present, India has four fully computerized national commodity exchanges for facilitating the trading practice in India.
What are the four key centers for trading in commodity?
These four key exchanges are the,
National Multi Commodity Exchange (NMCE)
Multi commodity Exchanges (MCX)
Indian Commodity Exchange (ICEX) and
National Commodity and Derivatives Exchange (NCDEX)
However, before you begin trading commodity, you should be aware of the various basic parameters that guide the ups and downs of the commodity market. Only when you are aware of these basics of trading, you can ensure substantial profits in commodity trading. Presented here is a brief idea on the trading system.
The benefits of trading in commodities
There are several advantages of this trading procedure. These advantages have been outlined as following.
It is much cheaper than trading in stocks. That is because the margins are considerably lower than that of the stock futures
Brokerage is comparatively considerably low in trading commodity futures
The trading process is less complicated. You are not required to study balance sheets or compare financial statements as with stocks. All you are required to do is to follow the demand and supply curve of the commodities that you are trading very closely.
Sound advice for the beginners
If you are new to this trading system, then first you should do your homework properly before you engage in trading. Here are the suggestions on how you should break into the market.
Visit the commodity exchange markets listed above to see which commodities are on offer for trading. There are only a select few commodities for beginners.
The NMCE has agricultural commodities and metallic commodities under its fold
The NCDEX offers metal, agriculture and energy commodities for trade
You may also check out the MCX for the availability of commodities
Once, you have decided the commodity based on your research, you hire a good commodity broker to do the job for you.
If you are interested in Commodity Trading and Intraday Trading, Forex Trading in India or choosing Trading as a Career; Sahajmoney is one stop shop for you. We help Indian investors maximum profits in Indian Stock market.