Both MCX and NCDEX are online commodity exchanges which help market participants to trade in precious metals, agricultural products and energy products. While, MCX is the largest commodity trading market in India, since , NCDEX has started picking up pace and is currently the largest commodity trading market in India in terms of volume. But commodity trading is not new in India.
The commodity trading market in India has a rich history which dates back to with the establishment of Bombay Cotton Trade Association. But a world war, fight for independence and poor government strategy, resulted in stagnant growth of the commodity trading market in India.
But with the establishment of NCDEX, one of the leading commodity exchanges in India, commodity trading has started picking up pace.
NCDEX allows trading in 23 commodities; highest across the global commodities market. Like the stock market, the commodity trading market is also dominated by:. Hegders : Hedgers are producers, manufacturers, etc who participate in the commodity trading market only to hedge their risk. Their aim is to reduce risk, not make profits. For example: A rice farmer wants to hedge the price risk on his produce. So, he enters into a futures contract. Now, if the price of rice falls in the local market, he can sell his futures contract and make profit.
In case the price rises, he can sell the produce at a higher price in the local market. This way farmers, manufacturers hedge their risk in the commodity markets. Speculators: Speculators are traders who simply speculate on the price of the commodity. Speculators aim to generate short term profits through commodity trading.
They do not face any risk, which needs hedging. For example, Ravi expects that the price of rice will go up in the coming months. So, he buys a rice futures contract and sells when the price increases. Read on.. Compliance Calendar is a consolidated checklist which helps members to comply with various requirements of compliance and submissions.
Eligible entities to follow a process to get empanelled themselves as Warehouse Service Provider and cater to the storage requirements of various market participants. This link shall take you to a page outside the MCX Website www. For any query regarding the contents of the linked page, please contact the webmaster of the concerned website.
All rights reserved. Multi Commodity Exchange of India Ltd. This is the first Shariah index created in India utilizing the strict guidelines and local expertise of a domestic Shariah Advisory Board. The index comprises the 50 largest and most liquid shariah compliant stocks within BSE Commodity Traded: It deals in 11 commodities. Are you worried or stressed? Click here for Expert Advice. Comment 0. Post Comment. Disclaimer: Comments will be moderated by Jagranjosh editorial team.
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