India has a long history of commodity futures trading from more than 125
years. There are several commodity exchanges including Multi Commodity
Exchange, the National Commodity and Derivatives Exchange and the National
Multi Commodity Exchange. Following are the points that will help you to
understand Commodity Futures Trading:
1.
The
commodity exchanges and commodity futures contracts are regulated by the
government under the Forward Contracts (Regulation) Act, 1952. Since Sept 2015
after FMC was merged with SEBI, SEBI is the regulator of Futures Market.
2.
A
commodity includes several goods that are allowed for futures trading under the
platform of the commodity exchanges recognized under the FCRA.
3.
A company
or an association or any other body corporate organizing futures trading in
commodities is termed as “Commodity Exchange”.
4.
Futures
contracts is a standardized Forwards contract which is exchange traded and is legal
agreement to buy or sell a particular commodity at a
Specified future time. There are many types of Futures contracts.
5.
Speculators
can benefit from changes in prices with respect to futures contracts that
mostly offset before their maturity and therefore scarcely end in deliveries.
6.
Price risk
management and price discovery are two major economic functions of a commodity
futures market. Price risk management is the backbone of a commodity futuresmarket. The need for Hedging (Price Risk Management) arises from price risks in
most commodities.
Founded in 2005, ABans Group has grown from being
a trading house to a dynamic and diversified business group. We provide
expertise in Broking Services, Merchant Banking, Non-Banking Financial
Dealings, Gold Refining and Realty and Infrastructure. In a nut shell ABans
Group is a comprehensive Financial Services and Solution Provider, which aims
to provide an end-to-end financial solution to all its clients.
No comments:
Post a Comment