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An Introduction of MCX and Factors That Differentiates Commodity Trading from Stock Trading

Author: Ayesha Jaiswal
by Ayesha Jaiswal
Posted: May 24, 2017

MCX is an exchange where all commodities are bought and sold in a different sector.MCX means the multi-commodity exchange which is a truly independent commodity exchange in India.It provides commodity transaction in the market.In mcx investor trade in commodities like gold, metal, silver etc.

As stock market commodity market also allow traders to but and sale in commodity under multi commodity exchange.

In 2016 Mcx was 7th in global commodity exchange in terms of a number of contracts traded in India.

It is an emerging sector of investment which provides a well-established platform for traders who want to invest in commodities, it also provides online commodity tips for the trade for their investment settlement.

The first question arises is which commodities are traded in Multi Commodity Exchange -

There are different sector -

Metals -

Precious Metal – Gold, Silver,, petal gold,gold mini, micro silver, mini silver, Base metal, copper, alluminum, zinc.

Energy -

Crude oil, natural gas, crude oil mini are few sector types in energy sector.

Agri Sector

Difference between Stock trading and commodity trading -

Stock trading is different from commodity trading to clear this confusion you can get stock tips and commodity tips by advisors who provides trading tips.

  1. 1In stock market traders do buy and selling of shares and debentures, Equity market comes in stock market While in commodities trading of precious metals gold, silver and many other commodities are traded.
  2. One of the major difference in trading in commodity and stock or share is a duration of time.Stock remain in the exchanges for many years in companies but in the case of commodity producer of particular commodity promises to a person to deliver at a specific time and date.
  3. MCX is one of the largest commodity exchange where traders invest in the commodity on the contract basis.Specific contracts are made for doing trading in commodity market.
  4. Investor purchase commodities in uncertain economic conditions both the sector provide equal profit to the investors.The benefit of a commodity is that they provide support of physical possessions.
  5. Most of the people misunderstand that commodity market does not liquidate easily this is the wrong perception because it is a contract based trading and producer of the commodity will have to pay cash according to the present value of a commodity.

The stock market and commodity market both are growing rapidly they have huge market share and complexities.An investor has to research properly before investing in a market.They also take help of the financial advisors for daily updates, Reports, Stock tips, commodity tips and follow ups.

About the Author

I am Kirti meliwal, working as Associate financial consultant in Epic Research Limited-the leading advisory firm in India.I have good knowledge about stock market, so i used to write articles on the same.

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Author: Ayesha Jaiswal

Ayesha Jaiswal

Flag of India
India

Member since: May 20, 2017
Total live articles: 37

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