Indian markets have currently thrown open a fresh avenue for retail traders and investors to participate in Commodities. For those who wish for to diversify their portfolios athwart bonds, shares and real estate, commodities is the most excellent option.
Till a few months ago, this would not have made intellect. For retail investors could have complete very little to truly invest in commodities such as silver and gold or oilseeds in the futures market. This was practically impossible in commodities except for gold and silver as there was virtually no retail routed for punting in commodities.
However, with the situation up of 3 multi-commodity exchanges in the nation, retail investors can now buy and sell in Commodity Futures without having corporeal stocks!
Commodities truly offer immense latent to become a divide asset class for market savvy arbitrageurs, investors and speculators. Retail investors, who claim to deem the Equity Markets may find commodities a bottomless market. But commodities are easy to deem as far as the fundamentals of supply and demand are concerned. Retail investors should deem the risks and benefits of trading in commodities futures previous to taking a leap. Historically, pricing in commodities futures has been a lesser amount of volatile compared with bonds and equity, thus providing a proficient portfolio diversification choice.
In fact, the volume of the commodities markets in India is also quite important. Of the country’s GDP of Rs 13,20,730 crore (Rs 13,207.3 billion), commodities related industries constitute about 58%.
Currently, the a variety of commodities across the country clock a yearly turnover of Rs 1,40,000 crore (Rs 1,400 billion). With the opening of futures trading, the volume of the Commodity Market grows several folds here on.