commodity markets (1)

7/25/2019 Commodity Markets (1)

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WHAT IS COMMODITY MARKETS?

Commodity Market:-

Trading place

For Commodities

Similar to Equity Market

Commodity:- Inputs in production of other goods.


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TOP GAINERS AND LOSERS IN COMMODITY M


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INVERSE RELATIONSHIP BETWEEN GOLD AND US D

There is an intrinsic co-relation et!een gold prices and the "S dollar:-

#emand for "S dollar falls people in$est in gold.

Similarly !hen dollar appreciates people in$est in stock market rathergold


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TYPES OF COMMODITIES

%ard Commodities:-

&recious Metals: 'old( Sil$er( &latinum

)ther Metals: *ickel( +luminum( Copper

Energy: Crude )il( *atural 'as( 'asoline

Soft Commodities:

,i$e-Stock: ,i$e Cattle( &ork ellies

+gro-ased Commodities: heat( Corn( Cotton( )ils( )ilseeds


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GLOBAL COMMODITY EXCHANGIn "S+ and Europe /

Chicago oard of Trade Chicago Mercantile E0change

,ondon Metal E0change

*e! 1ork Mercantile E0change

,ondon International Finance Future and )ption E0change

In 'ulf and +sia /

#uai 'old and Commodities E0change %ong 2ong Mercantile E0change

In China /

Shanghai Futures E0change

3heng4hou Commodity E0change


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INDIAN EXCHANGE

)$erall 56 e0changes

*ational le$el e0changes:-

o Multi Commodity E0change of India ,td( Mumai 7MC89.

o *ational Commodity and #eri$ati$e E0change( Mumai 7*C#E89.

o *ational Multi Commodity E0change of India ,td( +hmedaad 7*MC


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HOW TO TRADE

)pen a demat and trading account

ith registered roker

ecei$ing trading soft!are

ays to trade:-

Trade7uy;sell9 commodity in future market format. uy commodity in physical format.

uy commodity in demat format


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TRADING IN FUTURE MARKET

*o need to pay the full amount

&ayment of margin percentage

#ecided lot si4e y e0changes


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EXPIRY CYCLE:-

I. Can


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BUYING COMMODITY IN PHYSICAL FORMAT

uying commodity in future segment

Is physical deli$ery needed

Settlement in cash

2ept in e0change


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CONTRACT SPECIFICATION OF G

S!"ol GOLD#ESCI&TI)* '),#MMM11

T+#I*' &EI)# M)*#+1 T%)"'% S+T"#+

T+#I*' SESSI)* Monday to Friday: >?:?? am to >>Saturday: >?:?? am to 5:?? p

T+#I*'

Trading "nit > kg

Auotation;ase Balue >? gram

Ma0imum )rder Si4e >? 2g

Tick Si4e e.> per >? grams

#aily &rice ,imit The daily price limit !ill e @.hene$er dailyreached( the rela0ation !ill e allo!ed upto Dcooling period in the trade. In case the daily palso reached( then after a cooling o= period odaily price limit !ill e rela0ed upto .

Initial Margin Minimum .

DELI#ERY


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DELI#ERY

#eli$ery "nit > 2g

#eli$ery &eriod Margin 5 of the $alue of the open position during th

#eli$ery Centre7s9 +hmedaad and Mumai at designated Clearinat these centres and at additional deli$ery cent#elhi (Chennai and %yderaad

#eli$ery ,ogic Compulsory


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FMC MERGES WITH SEBI: FACTS TO KNOWABOUT THE MERGER OF REGULATORS

H$%&or o' &(e &)o re*+l,&or "od$e%

I%%+e% %&$.$/* co!!od$&$e% !,r0e&%

1(,& !er*er ,$!% &o ,c($e2e3

Me,%+re% " Se"$


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IMPLICATION OF SEBI AS A NEW REGULATOCOMMODITY MARKETS

rokers !ill ha$e to align !ith Sei roker egulations.

Merger of FMC !ith Sei( MC8( *C#E8 !ill e classiGed as deemed stock

C%+,,E*'ES F) SEI-

Finding additional manpo!er.Financial resources to monitor the commodities market.eef up sur$eillance team to monitor commodity segment.+ligning all securities and commodities rokers to uniform regulations.


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CURRENT SCENARIO


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CRUDE OIL

Unrefined petroleum product

Hydrocarbon deposits and other organic material

Refined to produce gasoline, diesel and various forms of petrochemicals.

Nonrenewable resource :- fossil fuel

Crude oil has direct implications on !nflation Rate.

"ovement on goods and services.

#eficit $alance of %ayment.

&'R() reserves.

(*change rate.

MAJOROILPRODUCINGCOUNTRIES(CNNRE


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MAJOR OIL PRODUCING COUNTRIES(CNN RE2016)


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MAJOR IMPORTERS OF CRUDE OIL


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IMPACT OF CRUDE OIL PRICES

E=ects of lo! crude oil prices on the "S economy

Shale oil drilling is unproGtale at these le$els

+d$antage to the Consumers and the +uto Industry and the +irline Indus

E=ects of lo! crude oil prices on the ussian economy

E=ects of lo! crude oil prices on )&EC

,o!er oil prices can lead to a crisis in the middle east region similar to 5


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HOW FALLING OIL PRICES IMPACT INDIA'S ECONO

)il prices crashed D percent on >;>;5?>D

Close elo! H@? a arrel for the Grst time in >5 years.

Falling crude is a lessing for the economy

%elping macro-economic management 7oth udget and Gscal9

Impro$ing macro fundamentals 7ination( Gscal deGcit and current accou

The eneGts are:-

Import Factor

e$ie!ing Monetary &olicy

eduction of Current +ccount #eGcit7C+#9

oost up Economic 'ro!th

Impro$ement in the Gscal deGcit.


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NO DEMAND,THEN WHY THEY ARPRODUCING?

)&EC likely !ants to keep the price do!n so the "S Shale p

to go Jout of usinessK. %o!e$er( the "S Shale production resilient so far. ussia is also at its highest output and Iran e0pected to increase its output in the coming months and tmany oil-dependent countries are Gnding it diLcult to handudgets.

If price remains lo! for too long( it is sure to cause geopolittension( lead the economies of Europe( the "S and apan todeation. )il producers !ill ha$e to cut production( in the futhe lo! price is unsustainale in the long-term. hen this soccur crude oil price !ill Gnd a ottom


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+s the year dra!s to a close( it is time to reNoice on our achie$ements and reect on our areas of gro!th. #uring the5?>( MC8 clocked an a$erage daily turno$er of s 5>(DOP crore( as against s >(6>O crore for the same period las

of aout >>.P( !hile the market share !ent up from O>.6 to O6.5. This feat has een achie$ed despite se$eral

prices ha$e fallen steeplyQfrom natural gas 7659 and crude oil 7@69 to ase metals like nickel 76>9 and 4inc 75

import policy and duty structure of ullion has also a=ected trading in ullion contracts. The increase in turno$er de

underlines( once again( the roustness of the MC8 platform as a risk management platform. In the coming year( und

super$ision of the SEI( !e hope to introduce ne! products and ser$ices to meet the e$ol$ing risk management nee

gro!ing economy. MC8 has had a numer of achie$ements in 5?>. )n anuary ?D( 5?>( it launched a crude oil mi

facilitating price risk management for the SMEs( and physical market participants. e entered into an Mo" !ith CME

!orlds leading and most di$erse deri$ati$es marketplace9 on uly 5>( 5?>( contemplating a numer of ne! initiati$

setting up of an e0change( a clearing corporation( and trade repository ser$ices at the International Finance Ser$iceIndia( !ider cooperation in the future and option contracts( Noint product de$elopment( and marketing and customer

has een partnering !ith educational institutions for spread of Gnancial literacy in the commodity ecosystem. Mo"s

institutions ha$e een signed this year( !ith the latest eing Chitkara "ni$ersity( Chandigarh( on #ecemer ( 5?>

honoured !ith the E0change of the 1ear for In$estors Education and +!areness +!ard y the Commodity &articipa

India on @? May and est Commodity E0change +!ard at the India International ullion Summit on ?> #ec 5?>.


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Energy trade relations !ere e0pected to e re!ritten( !ith +sia thedestination for O? of regionally traded coal( P oil( and D? na

5?6?. orld energy sector in$estments !ere anticipated at HDO tri

5?> to 5?6?( of !hich @P !as e0pected in oil and gas supply( 5

po!er supply( and @5 in end-use eLciency


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commodity markets (1)

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