Commodity Mkt vs Spot Mkt

8/4/2019 Commodity Mkt vs Spot Mkt

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COMMODITY

MARKET

VERSUS

SPOT MARKET


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Objective

To analyse the opportunities in the CommodityMarket

Feasibility study of the process of makingdeliveries in commodity market to get profitfrom the difference between spot price andcommodity futures price.

To analysethe time value of commodities inIndian Exchanges


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Scope of Study

This study will be helpful for the dealers of theexchange traded commodities

This method of investment may have thepossibility to emerge as an innovativeinvestment technique.

It sometimes gives more profits than that ofeven speculators getting in their best time.


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Company overview- DBFS

Doha Brokerage and Financial Services LtdEstablished in 1992, as Select Securities,oneof the first corporate brokerages in India

In the year 2006 Doha Bank took over 49percent stake in the company and wasrenamed as DBFS.


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Products and Services

Equities

Mutual Funds

Commodities Portfolio Management

Internet trading

Derivatives


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Evolution of Commodity market in India

Derivatives as a tool for managing risk first originatedin the commodities markets. They were then founduseful as a hedging tool in financial markets as well.

In India, trading in commodity futures has been inexistence from the nineteenth century withorganised trading in cotton through theestablishment of Cotton Trade Association in 1875.

Bombay Cotton Trade Association Ltd., set up in1875, was the first organised futures market.


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Major Commodity Exchanges in India

Multi Commodity Exchange of India Ltd.(MCX)

National Commodity and DerivativesExchange Ltd.(NCDEX)

National Multi Commodity Exchange of IndiaLtd.(NMCE)


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Major commodities trading in Indian exchan

Bullion

Metals

Spices Energy

Plantations

Oil & Oil seeds


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Price Ranges of Cardamom


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Price Ranges of Gold


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Price Ranges of Pepper


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Qualities required for Commodities delivery

q Cardamom

Liter weight; 380-420 gm

Colour; Green

q Pepper

Liter weight; 570-600 gm

Size; Above 8mm

Colour; Black

Moisture; Less than 12%

q Rubber

RSS 4


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Institutions, giving finantial supports

ICICI

BNP Paribas

Federal Bank Major Stock broking firms

South Indian Bank


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Limitations of Study

This is an upcoming trend in the market. Notmany people can be viewed as experts in thistrade.

Time constraints

References for literature review could not beobtain due to lack of secondary dataavailable on this topic.


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Findings & Suggestions

This method of investment is highly profitablewith comparatively lesser risk. It is seen as apotentially growing sector for the future.

Investors should be highly alert to suchopportunities as and when they arise in the

market


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Thank You

Documents

Commodity Mkt vs Spot Mkt