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Best Commodity Broker

Commodities definitely offer investors a safer edge during the time of inflation. Commodities like gold and silver provide many benefits to investors during Economic uncertainties.

Diversification
Protection against inflation
Potential return
Trading on lower margin
Hedge against Risk
Liquidity
A safe refuge during crisis

Investing in Commodities

There are several ways to consider investing in commodities. One is to purchase varying amounts of physical raw commodities, such as precious metal bullion. Investors can also invest through the use of futures contracts or exchange-traded products (ETPs) that directly track a specific commodity index. These are highly volatile and complex investments that are generally recommended for sophisticated investors only.

Another way to gain exposure to commodities is through mutual funds that invest in commodity-related businesses. For instance, an oil and gas fund would own stocks issued by companies involved in energy exploration, refining, storage, and distribution.

  • Diversification
  • Potential returns
  • Hedge against Risk
  • A Safe Refuge during Crisis
  • Protection against Inflation
  • Trading on Lower Margin
  • Liquidity

Ajmera x-change is among the “Best Commodity Brokers” in India. We cater to all financial needs of Ultra High Net worth, High net worth, Retail individuals and corporations Pan India. The commodity stocks in India facilitate multi-commodity exchange within and outside the country based on requirements. Commodity trading online is a facility that investors can explore for investment. These stocks in India act as a good hedging instrument against investments in equity and currency markets. Commodity brokers in India are growing exponentially as the investor base penetration increases. This trading platform is also IBT enabled giving our clients the facility to trade on their fingertips and #letsgetgoing. We also provide a call-in Trade facility wherein our client can just call us to transact. Commodities definitely offer investors a safer edge during the time of inflation. Commodity trading online like gold and silver provide many benefits to investors during economic uncertainty. Commodity brokers in India can be judged based on the commodities it allows to be traded, brokerage it charges, trading apps, etc.

The market is a physical or virtual market place for buying, selling and trading raw or primary products. There are currently 50 major commodity markets worldwide that facilitate trade in approximately 100 primary commodities. Commodity brokers in India invest in commodity stocks in India can be broadly segmented into two types, Soft & Hard Commodities. According to the commodity brokers in India Soft Commodities are those which are grown out of agricultural sources such as farms and livestock. In future markets, soft commodities are a major part. They are used both by farmers wishing to lock - in the future prices of their crops and by speculative investors seeking profit. Softs offer many advantages such as the vast quantity of commodities to be traded, these include coffee, cocoa, sugar, corn, wheat, soybeans, fruits & vegetables. It has a restricted shelf life and is highly conducive to damage due to weather changes. In terms of price volatility, weather plays a crucial role in determining the prices of soft commodities apart from its demand and supply in the market.

According to the commodity brokers in India Hard Commodities are those which are obtained out of Earth. They are either mined or extracted from the earth in the form of natural resources. Silver, copper, iron, Gold & crude oil are considered to be hard commodities. It can also be obtained as a byproduct of processing/refining primary hard commodities such as Gasoline. These are more durable and storable in nature and are not prone to weather changes as much as soft commodities. They are not perishable in nature and possess unlimited shelf life if stored correctly. Its price discovery and volatility are based on more global macro-economic parameters such as Supply, shortage, production costs, GDP and Interest Rates. Their price volatility is restricted by external factors/government.

Ajmera Group is one of the best broker for commodity trading in India providing research and advisory to help investors achieve their financial goals.

contact us for more details commodity faq

Commodity FAQ

  • Fair Price Discovery and Transparency: Trading in the commodity futures is often considered as transparent and through the large-scale participation; fair price discovery process is confirmed as well. Also large participation illustrates expectations and the views of the wider section of people who are concerned with the commodity.
  • Online platform: Processors, traders and producers along with importers or exporters for the purpose of managing price risk widely use the online platforms offered by NCDEX/MCX.
  • Hedging: It gives form to the producers in order to hedge positions based on their exposure within the physical commodity.
  • Simple Economics: The mechanism of commodity trading is depended on the simple economics that is, supply and demand. The price of the commodity is quite higher if its demand is higher and vice versa.
  • Low margins: Future traders of the commodity are needed to deposit quite low margins; roughly it is 5% to 10% of the contract’s total value, which is much lower in comparison to other classes of asset.
  • No counter party risk: Commodity Futures possesses Clearing Houses, just like exchanges within equity market that confirm the fact that contract terms totally fulfils and thus is responsible for eliminating the risk associated with the counter party.
  • Wide participation: The emergence of online trading enabled a wide expansion within the commodity market over the years.
  • Evolved pricing: The development in the participation could minimize risks of the cartelization, confirming the holistic perspective towards the commodity. Thus, pricing can be more or less irrational and more practical resulting in the Discovery Mechanism of fair price.

Commodity Exchange is the market place where the commodity trading is taken place. Currently, there are three exchanges of national-level within the country where commodity trade can take place like National Commodity and Derivative Exchange (NCDEX), Multi Commodity Exchange of India LTD (MCX) and National Multi Commodity Exchange of India Ltd (NMCE). There are 21 smaller exchanges as well offering the commodity trading at regional level.

What is Commodity Market ?

Commodity market is a marketplace for facilitating trading in different commodities. Market can be a derivative or spot market. In the derivatives market, different financial instruments like futures and options are specifically traded based on the commodities. On the other hand, in spot market commodities are sold and brought for the immediate delivery. Such financial instruments like ‘futures’ are often traded in the online commodity exchanges.

Commodity Futures are the contracts for selling or buying particular quantity of the specific commodity at the future date. It is quite similar to the Stock futures and Index futures but underlying occurs to be the commodities in place of indices and Stocks.

Contango is a situation where the futures price of a commodity is above the expected spot price. Contango refers to a situation where the future spot price is below the current price, and people are willing to pay more for a commodity at some point in the future than the actual expected price of the commodity. This may be due to people's desire to pay a premium to have the commodity in the future rather than paying the costs of storage and the carry costs of buying the commodity today.

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