WHAT IS COMMODITY TRADING
                     WHAT IS COMMODITY 
TRADING?
• Commodity trading offers a wide range of investment options in addition 
to the typical options of stocks, bonds, and real estate. 
• Adding commodities exposure to your existing portfolio, according to 
historical data, helps you enhance returns while minimising risk. Other 
asset types have little or no correlation with commodities.
• The purchasing, selling, and trading of commodities is known as 
commodity trading. Derivative contracts such as commodity futures and 
options are commonly used in india for commodities trading.
How to start commodity trading in 
India?
• Commodity futures are the best option to invest in commodities. A 
commodities futures contract is an agreement to buy or sell a 
specific commodity at a predetermined price at a future date.
•  Every commodity listed on exchanges like MCX has futures 
available.Commodity trading is commonly used to hedge prices in 
order to avoid losses due to significant price volatility in vital 
commodities. 
• Commodity trading is regarded to be a high-risk endeavour, thus 
only experienced traders and investors engage in it.
Advantages of commodity trading 
in India
• Commodity trading protects against inflation and price increases 
that occur unexpectedly.
• Commodity trading can help protect prices against a black swan 
event that could result in a price increase or severe discount.
• Commodity futures can have a lot of leverage, which means that a 
minor price change can result in a lot of money.
• Commodities can help diversify portfolios and minimise over-
concentration caused by significant stock exposure.
CONCLUSION
The trading of commodities is not restricted by geographical limits. 
As a result, the commodity market might start in a small town and 
extend beyond national lines. The demand and supply hypothesis 
determines how much a commodity costs in a market.
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