Guide to Commodity Futures Trading

Commodity Futures are contracts to buy/sell a specific quantity of a particular commodity at a future date. It is exactly similar to the Index futures and Stock futures but the underlying here happens to be commodities instead of Indices and Stocks.

Commodity futures market has been in existence in India for over centuries now. The Government of India banned futures trading in certain commodities in the 70s. However, trading in commodity futures was again permitted again by the government in order to help the commodity producers, traders and investors. It is interesting to note that World-wide, the commodity exchanges originated much before other financial exchanges. Infact most of the derivatives instruments had their birth through the commodity exchanges.

Commodities are the best option for those who want to diversify their portfolios beyond real estate, bonds and shares. Commodities can be an unfathomable market for retail investors who claim to understand the equity market. But commodities become convenient to understand if you are well-versed with the fundamentals of demand and supply. We suggest you not to take a leap into commodity futures if you do not clearly understand the risks and advantages of commodity trading. Commodities futures provide an efficient portfolio diversification option because their pricing is less volatile as compared to the equity and bond markets.

Commodities market is growing many folds with the introduction of futures trading. You have three options to trade in Commodity Futures – the National Commodity and Derivative Exchange, the Multi Commodity Exchange of India Ltd and the National Multi Commodity Exchange of India Ltd. All three have a national presence, settlement systems and electronic trading. You can opt for a brokerage firm that is already established and has sought membership with NCDEX and MCX. The minimum investment required in commodity futures can be as low as Rs.5,000. You will need only one bank account to start trading in the commodityfutures market. If you are dealing with a broker then you have to enter into a KYC with the broker as a part of the account opening process and just like in stocks, you can open a separate commodity demat account with MCX and NCDEX.Investors can refer daily financial newspapers for information on 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 FinancialDealings, 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.

Trading Strategies

Traders always search for new trading strategies to make their businesses successful. But few traders are able to find such winning algorithms that proves fruitful to them. Stock traders are always keen on finding winning strategies because they can earn maximum commissions as well as trust with the increasing number of clients attracted towards them. It is true that traders usually switch to next trading practice once they observe the strategy working for a good number of times failed to yield results. Thus an inconsistency will be created in flow of progress which eventually leads to nowhere. If you want a winning trading strategy, then keep the following four trading tips in mind:

1. Simplicity –Instead of making new trading strategies, follow the simple ones continuously as it will give better results even it fails sometimes. Opt for easiest one to learn from among the most effective trading systems and strategies.

2. Speed Trading – You will lose focus and be distracted if you take longer time to trade. Thus it is important for you to quickly grasp the concept of closing the deals by the minute and this will help you to stay longer in this field.

3. Do not stick to Screen –Be more instinctive and rely less on screen for effectiveness in trading.

4. Stick to your Routine –You will surely succeed if you follow your methods with 100% dedication and do not deviate from your routine trading. You should experiment with your approach but not with your strategy.

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, Jewellery manufacturing and Realty and Infrastructure. It is a comprehensive Financial Services and Solution Provider,which aims to provide an end-to-end financial solution to its clients.

Commodity Investment Guide

Commodity trading market involves a high degree of risk and excitement. Traders earn a huge amount of money in this trading but at the same time they can lose their hard earned monies. It is necessary for any trader to move with a systematic approach because there are lot of economic fluctuations that scare people a lot. Before investing in commodity market, you must be extra careful or take suggestions from ABans Group – a commodity trading company.

Recover your hard earned money by accessing plenty of tools and websites that provide detailed information about trading in commodity market. Various financial instruments makes the information more accessible, easily available and it gives traders an ease of understanding the market in the best possible way. A thorough understanding and careful analysis of the market is always required because the commodity market deals with several complicated concepts.

Understanding the movement of market trends will help you to gain more profits in short run. Commodity market fluctuates a lot because of its volatility and thus you should have enough knowledge to understand the difference between the striking prices. Always gain knowledge about this market by asking experts or accessing internet which is an efficient source of information and quite reliable in providing support related to trading.

MCX basically deals with hard commodities – gold, copper, silver whereas NCDEX in soft commodities – pepper, jeera, coriander, soya bean and more. Taking an expert advice from ABans Group will be a less risk in losing your money because the tips provided by our team are 100% accurate.

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, Jewellery manufacturing and Realty and Infrastructure. It is a comprehensive Financial Services and Solution Provider,which aims to provide an end-to-end financial solution to its clients.