Like shares and Forex, commodity derivatives’ trading is raising among the Indian investors, as the market has opened up a wide platform for retail investors and traders to take part in commodities. If you are from Chennai, you may approach the Commodity Trading in Chennai.
Multi-commodity exchanges like the Multi commodity exchange of India Ltd, the National Multi Commodity Exchange of India Ltd and the National Commodity and Derivative Exchange are established in the country to support the retail investors, who wish to diversify their portfolios beyond shares, bonds, real estate, and start commodity trading.
The trading & settlement system in these exchanges is electronic; this makes it convenient to deal in commodities futures like silver, gold, base metals, crude oil, natural gas, agricultural commodities among others, without the need of possessing them as physical stocks.
Additionally, live share prices, allows the trader to make smarter decisions by following the market movements quickly.
Understand the basics
In this mode of trading, the investors can fund their account on the basis of their comfort level and risk tolerance level.
However, it is very important to start familiarizing the norms of trading strategies and placing orders to deal wisely and avoid overtrading.
While trading in commodities, the investors have to do their homework well, understand the basics of demand and supply, and make wise decisions based on the storage and consumption of products.
This offers an excellent portfolio diversification option to the investors since the commodities futures are less volatile compared to bonds as well as equity.
Retail investors can involve in commodity trading seeking the support of a broker and trading happens online through the internet similar to the equities.
Here brokers need not have to register themselves with the regulator.
Like stocks trading, in this also the investor will require a bank account, a commodity demat account & account with depository to begin.
An agreement with the broker is required. For Chennai based investors the Commodity Brokers in Chennai is best.
A retail investor can start their journey into commodity trading just with a minimum amount of Rs.5000.
Hope this article was useful to you. For more guidance, you may approach the Commodity Trading in Chennai.