SUMMER TRAINING PROJECT REPORT

ON
COMPREHENSIVE STUDY ON COMMODITY MARKET

Submitted in the partial fulfillment for the award of the degree of

Master of Business Administration (BBA)

Under the Esteemed Guidance of:

Submitted by:

Ms. Neetu Chadha

Purushottam Kumar Sinha

Assistant Professor

04214701809

DELHI INSTITUTE OF ADVANCED STUDIES

(Affiliated to the Guru Gobind Singh Indraprastha University, Delhi)

ACKNOWLEDGEMENT

I would like to express word of thanks to all those who have provided me with sincere advice
and information during the course of my training period. It was indeed a great pleasure for me to
work in a very cooperative, enthusiastic and learning atmosphere at Share Khan limited.
I sincerely thank to my teacher Ms. Neetu Chadha(Assistant Professor at DIAS) for her
guidance and support throughout the project. She has been a great source of motivation to me. I
thank her for full cooperation for the generation of this training report. Her effective guidance
and affections are gratefully appreciated.
I also like to express my sincere thanks to Mr. Amit Garg (Assistant Manager at Sharekhan
limited) for helping me and providing me with right direction during the completion o my
project. He gave me highly valuable suggestions, for which I am eternally indebted.

With all the heartiest thanks, I hope my final project report will be a great success and a good
source of learning and information.

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DECLARATION

I hereby declare to the best of my knowledge and belief that the summer training project report
titled as Comprehensive Study on Commodity Market done at share khan limited, being
submitted as the partial fulfillment of the degree of Machelor of Business Administration (BBA),
has been written and submitted under the guidance of Ms. Neetu Chadha.
I further declare that it is original work done as a part of the academic course and has not been
submitted elsewhere.
The facts and data written in this project are based on the data collected by me while preparing
this report.

Purushottam Kumar Sinha

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INDEX
My project report is divided into several divisions and their description is as follows:

Title page..

(i)

Acknowledgement

(ii)

Declaration

(iii)

Certificate.

(iv)

Chapter 1- Introduction..

Chapter 2- Research Methodology.

Chapter 3- Company Profile...

Chapter 4- Demat Account Service

Chapter 5- About Online Trading...

Chapter 6- Frequently Asked Questions (FAQs)

Chapter 7- Findings & Recommendations..

Chapter 8- Conclusion..

Bibliography

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CHAPTER 1

INTRODUCTION

FINANCIAL MARKET
In economics, typically, the term market means the aggregate of possible buyers and sellers of a
certain good or service and the transactions between them.
The term "market" is sometimes used for what are more strictly exchanges, organizations that
facilitate the trade in financial securities, e.g., a stock exchange or commodity exchange. This
may be a physical location (like the NYSE) or an electronic system (like NASDAQ). Much
trading of stocks takes place on an exchange; still, corporate actions (merger, spinoff) are outside
an exchange, while any two companies or people, for whatever reason, may agree to sell stock
from the one to the other without using an exchange.
Trading of currencies and bonds is largely on a bilateral basis, although some bonds trade on a
stock exchange, and people are building electronic systems for these as well, similar to stock
exchanges. Financial markets can be domestic or they can be international.

TYPES OF FINANCIAL MARKET

The financial markets can be divided into different subtypes:
Stock markets, which provide financing through the issuance of shares or common stock,
and enable the subsequent trading thereof.
Bond markets, which provide financing through the issuance of bonds, and enable the
subsequent trading thereof.
Commodity markets, which facilitate the trading of commodities.
Money markets, which provide short term debt financing and investment.
Derivatives markets, which provide instruments for the management of financial risk.
Futures markets, which provide standardized forward contracts for trading products at some
future date; see also forward market.
Insurance markets, which facilitate the redistribution of various risks.
Foreign exchange markets, which facilitate the trading of foreign exchange.
The capital markets consist of primary markets and secondary markets. Newly formed (issued)
securities are bought or sold in primary markets. Secondary markets allow investors to sell
securities that they hold or buy existing securities. The transaction in primary market exists
between investors and public while secondary market its between investors.
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INTRODUCTION TO THE INDUSTRY

What is stock market?

A stock market or equity market is a public (a loose network of economic transactions, not
a physical facility or discrete) entity for the trading of company stock (shares)
and derivatives at an agreed price; these are securities listed on a stock exchange as well as
those only traded privately.
The size of the world stock market was estimated at about $36.6 trillion at the start of
October 2008. The total world derivatives market has been estimated at about $791 trillion
face or nominal value, 11 times the size of the entire world economy.

About the Indian stock market

In India there are 23 stock exchanges of which the major ones are:
Bombay stock exchange(BSE)
National Stock Exchange(NSE)

BSE:- At the end of the American civil war, the brokers who thrived out of this war in 1874,
found a place in a street, where they would easily assemble and transact business. This street is
nowadays, popularly known as DALAL STREET. In 1887, they formally established in
Bombay, and were known as Native Shares and Stock Brokers Association. In 1895, it
acquired a premise in the same street and finally was inaugurated in 1899 with the name Bombay
Stock Exchange (BSE).
India's premier stock exchange Bombay Stock Exchange (BSE) can also trace back its origin to
as far as 125 years when it started as a voluntary non-profit making association. You hear about
it any time it reaches a new high or a new low, and you also hear about it daily in statements like
'The BSE Sensitive Index rose 5% today'. Obviously, stocks and stock markets are important.
Stocks of public limited companies are bought and sold at a stock exchange. But what really are
stock exchanges? Known also as News on the stock market appears in different media every day.
The stock market , a stock exchange is an organized marketplace for securities (like stocks,
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bonds, options) featured by the centralization of supply and demand for the transaction of orders
by member brokers, for institutional and individual investors. The exchange makes buying and
selling easy. The need for stock exchanges developed out of early trading activities in
agricultural and other commodities. During the middle Ages, traders found it easier to use credit
that required supporting documentation of drafts, notes and bills of exchange.

India's other major stock exchange National Stock Exchange (NSE), promoted by leading
financial institutions, was established in April 1993. Over the years, several stock exchanges
have been established in the major cities of India. There are now 23 recognized stock exchanges
Mumbai (BSE, NSE and OTC), Calcutta, Delhi, Chennai, Ahmedabad, Bangalore,
Bhubhaneswar, Coimbatore, Guwahati, Hyderabad, Jaipur, Kochi, Kanpur, Ludhiana,
Mangalore, Patna, Pune, Rajkot, Vadodara, Indore and Meerut.

NSE: - With the liberalization of Indian economy it was found necessary to lift the Indian stock
markets on par with the international standards. The NSE was incorporated in 1992 by industrial
development bank of India, industrial credit and Investment Corporation of India, industrial
finance corporation of India, all insurance corporations, selected commercial banks and others.

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NSE is Indias leading stock exchange covering more than 160 cities and towns across the
country. It provides the modern fully computerized trading system designed to offer investors
across the country a safe and easy way to invest to liquidate investment and securities. Investors
in many areas of country did not have the same access and opportunity to trade so there arise the
need for setting up the national stock exchange. The NSE network has been designed to provide
equal access to investors from anywhere in India and to be responsive to their needs.
On its recognition as a stock exchange under the Securities
Contract Act, 1956 in April 1993, NSE started operations in the Wholesale Debt Market (WDM)
segment in June 1994. Capital market (equities) segment commenced operations in November
1994, and operations in derivative segment started in June 2000.NSE started trading in the
capital market segment on November3, 1994 and within one year became the largest exchange in
India, in terms of volumes transacted. During the year 2005-06 NSE reported, a turnover of Rs
1,569,556 crores in the equity segment.
The Indian retail brokerage market, which is going through a wonderful phase with high growth
rate. The total trading volume of the Indian brokerage companies stood at US$ 1239.1 billion in
the year 2004, which increased to US$ 1492.1 billion in 2005. It is further expected to reach US$
6535.7 billion by the year 2015.

INTRODUCTION TO THE COMPANY:

Sharekhan is one of the top retail brokerage houses in India with a strong online trading
platform. The company provides equity based products (research, equities, derivatives,
depository, margin funding, etc.). It has one of the largest networks in the country with 704 share
shops in 280 cities and Indias premier online trading portal www.sharekhan.com. With their
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research expertise, customer commitment and superior technology, they provide investors with
end-to-end solutions in investments. They provide trade execution services through multiple
channels - an Internet platform, telephone and retail outlets.
Share khan has always believed in investing in technology to build its business. The company
has used some of the best-known names in the IT industry, like Sun Microsystems, Oracle,
Microsoft, Cambridge Technologies, Nexgenix, Vignette, VeriSign Financial Technologies India
Ltd, Spider Software Pvt Ltd. to build its trading engine and content. The Morakhiya family
holds a majority stake in the company. HSBC, Intel & Carlyle are the other investors.
Sharekhan offers its customers a wide range of equity related services including trade execution
on BSE, NSE, and Derivatives. Depository services, online trading, Investment advice,
Commodities, etc. It is a depository participant of the NSDL and CDSL.
This site gives access to superior content and transaction facility to retail customers across the
country. Known for its jargon-free, investor friendly language and high quality research, the
content-rich and research oriented portal has stood out among its contemporaries because of its
steadfast dedication to offering customers best-of-breed technology and superior market
information. Pioneers of online trading in India- Sharekhan.com was launched in 2000 and is
now the second most visited broking site in India.
Share khan has one of the best states of art web portal providing fundamental and statistical
information across equity, mutual funds and IPOs. One can surf across 5,500 companies for indepth information, details about more than 1,500 mutual fund schemes and IPO data.
One can also access other market related details such as board meetings, result announcements,
FII transactions, buying/selling by mutual funds and much more.

NATURE OF BUSINESS CARRIED

Sharekhan is a stock broking company. The company offers a complete range of pre trade, trade
and post trade service on the BSE (Bombay stock exchange) and the NSE (National stock
exchange).
Whether the client come in to the companys conventionally located offices and trade in a
dedicated environment or issue instructions over the phone, the highly trained team and
sophisticated equipment ensure smooth transactions and prompt service.
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 Investment Advisory service

Facilitation services to Retail Investors, Corporate.
Depository services

Investment options include:

Online trading (Includes equity, derivatives)

Commodities trading

Mutual funds

Portfolio management service

Operations:

Institutional broking

Investment Banking

Retail Broking

Through trading and settlement process the investor converted into the final product. The
clearing house of exchange may act as legal counter party to all dealers for all deals in equity
derivatives instruments on exchanges. Thus the both the parties to an equity derivatives met
either by the party itself or in the event of default on the part of the party, by clearing
corporation.
A client can trade only through a trading member of the exchange. A clearing member can act as
trading member. The process of trading is similar to screen based trading in securities like
shares on an exchange. The exchange introduced standardized contract where settlement date, is
specified by stock exchange and the client can enter into contracts with different contract/ strike
price.
In order to minimize the risk of failure parties to contract in full filling their respective obligation
under the contract, the Clearing Corporation/trading members. Margins are required to be paid
by clearing/trading members who in turn, collect margin from their respective clients.

VISION, MISSION AND OBJECTIVES

Vision: To be the best retail broking brand in the Indian equities market

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Misson: To educate and empower the individual investor to make better investment decisions
through quality advice and superior service

Objectives:

To ensure satisfaction through teamwork and professional management

To provide good quality of services on a continuous basis to the satisfaction of clients.

To extend effective guidance to brokers, to clearing house Corporation, companies and

investor in E-Stock Trading.

To eliminate paper work and bring in front of electronic stock market in India.

Business Challenges:
Easily access customer portfolio information in a secure contact centre environment.
Seamlessly integrate with back-end applications and streamline customer data to contact
centre agents.
Easily manage upgrades and technology issues to accommodate growing customer base.

COMPANY PROFILE

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HISTORY OF SHAREKHAN
Share khan limited is the second largest broker of share market. It was developed on 17 ocober
1922 in MUMBAI. Share khan Limited is a retail financial services provider with a focus on
equities, derivatives and commodities brokerage execution on the National Stock Exchange of
India Ltd. (NSE), Bombay Stock Exchange Ltd. (BSE), National Commodity and Derivatives
Exchange India (NCDEX) and Multi Commodity Exchange of India Ltd. (MCX). Sharekhan
provides trade execution services through multiple channels - an Internet platform, telephone and
retail outlets and is present in 225 cities through a network of 615 locations.
Sharekhan was established by Morakhia family in 1999-2000 and Morakhia family, continues to
remain the largest shareholder. It is the retail broking arm of the Mumbai-based SSKI
[SHANTILAL SHEWANTILAL KANTILAL ISWARNATH LIMITED] Group, which has over
eight decades of experience in the stock broking business. Share khan offers its customers a wide
range of equity related services including trade execution on BSE, NSE, Derivatives, depository
services, online trading, investment advice etc.
SSKI which is established in 1930 is the parent company of Sharekhan ltd. With a legacy of
more than 80 years in the stock markets, the SSKI group ventured into institutional broking and
corporate finance over a decade ago. Presently SSKI is one of the leading players in institutional
broking and corporate finance activities. SSKI holds a sizeable portion of the market in each of
these segments. SSKIs institutional broking arm accounts for 7% of the market for Foreign
Institutional portfolio investment and 5% of all Domestic Institutional portfolio investment in the
country. It has 60 institutional clients spread over India, Far East, UK and US. Foreign
Institutional Investors generate about 65% of the organizations revenue, with a daily turnover of
over US$ 2 million. The Corporate Finance section has a list of very prestigious clients and has
many firsts to its credit, in terms of the size of deal, sector tapped etc.
Sharekhan Ltd. is a brokerage firm which is established on 8th February 2000 and now it is
having all the rights of SSKI. It is first brokerage Company to go online. The Company's online
trading and investment site - www.Sharekhan.com - was also launched on Feb 8, 2000. The site
gives access to superior content and transaction facility to retail customers across the country.
Known for its jargon-free, investor friendly language and high quality research, the site has a
registered base of over one lakh customers. The number of trading members currently stands at
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over 3 Lacs. While online trading currently accounts for just over 2 per cent of the daily trading
in stocks in India, Share khan alone accounts for 32 per cent of the volumes traded online.
The content-rich and research oriented portal has stood out among its contemporaries because of
its steadfast dedication to offering customers best-of-breed technology and superior market
information. The objective has been to let customers make informed decisions and to simplify
the process of investing in stocks.
On April 17, 2002 Share khan launched Speed Trade, a net-based executable application that
emulates the broker terminals along with host of other information relevant to the Day Traders.
This was for the first time that a net-based trading station of this calibre was offered to the
traders. In the last six months Speed Trade has become a de facto standard for the Day Trading
community over the net.

Share khans ground network includes over 588 centres in 148 cities in India, of which 32
are fully-owned branches.

PROFILE OF THE COMPANY

Name of the company

Sharekhan ltd.

Year of Establishment

1925

Headquarter

Mumbai - Maharashtra, INDIA- 400013

Nature of Business

Service Provider

Services

Depository Services, Online Services and Technical

Number of Employees

Over 3500

Revenue

Data Not Available

Website

www.sharekhan.com

Slogan

Your Guide to The Financial Jungle.

Research.

SHAREKHAN LIMITEDS MANAGEMENT TEAM

Dinesh Murikya

Owner of the company

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Tarun Shah

CEO of the company

Shankar Vailaya

Director (Operations)

Jaideep Arora

Director (Products & Technology)

Pathik Gandotra

Head of Research

Rishi Kohli

Vice President of Equity Derivatives

Nikhil Vora

Vice President of Research

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ORGANISATION CHART

Branch
Head

Regional Sales
Manager

Territory sales
manager

Equity
Advisors

Back Office
Dept.

Relationship
Managers

Customer care

Accounting
Department

acccr
e

c
Assistant
Manager

Trainees
Direct Sales
Executive

AREA OF OPERATION OF SHAREKHAN

The area of operations of SHAREKHAN is spread over two countries. They are: INDIA & UAE
The services are available through a network of 1437 Share shops spanning 170 major towns and
cities in the country along with an international branch in Dubai (UAE). Growing retail network
across 1120 franchisees, 168 branches and 325 cities.

PRODUCTS AND SERVICES PROFILE

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Sharekhan is one of India's leading financial services companies. It provides a complete lifecycle of investment solution in Equities, Derivatives, Commodities, IPO, Mutual Funds,
Depository Services, Portfolio Management Services and Insurance. Also offers personalized
wealth management services for High Net worth individuals. With a physical presence in over
400 cities of India through more than 800 "Share Shops", and an online presence through
Sharekhan.com, India's premier online destination; it reaches out to more than 800,000 trading
customers.
The product of Share khan can be broadly classified into three types suiting the clients
trading habit.
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Three key products

IT enabled call Center for servicing clients

Integrated Depository service/Demat account for transparency

Online fund transfer facility with HDFC, Citibank, GTB, IDBI Bank. Regular banking
facility with any bank in India.

Sharekhan also offers personalized research advice through Website, e-mail, SMS and
Messenger

PRODUCTS:
Online products offered by Sharekhan are as follows:
1. CLASSIC ACCOUNT:
This account allows the client to the trade throughout
website and is suitable for the retail investors. Our online trading
website also comes with the Dial Trade service that enables you to
buy and sell shares by calling their dedicated toll free number.
2. SPEEDTRADE:
SPEEDTRADE is a next-generation online trading product that
brings the power of your brokers terminal to your PC. It is ideal for
active traders who transact frequently during days trading session
capitalize on intra-day price movements. SPEEDTRADE is an
internet-based application available on a CD, which provides everything a trader needs on one screen, thereby, reducing the required to execute a
trade. SPEEDTRADE has all the above-mentioned features with the power to trade in
cash and derivatives from a single screen.
3. COMMODITIES:

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Commodity derivative comprise of raw material and

products that can be traded on special commodity exchanges across the country. It includes crude
oil, gold, silver, grains etc. Commodities expand your investing horizon from investing in a
metal company to trading in the metal itself. Trading in commodities provides unique market
opportunities for a wider section of participants.
There are two exchanges for trading in commodities:

Multinational Commodity Exchange Of India Ltd., Mumbai

(MCX) www.mcxindia.com

National commodity and derivative exchange, Mumbai

(NCDX) www.ncdx.com

HOW TO OPEN AN ACCOUNT WITH SHARE KHAN LIMITED?

For online trading with Sharekhan Ltd., investor has to open an account. Following are the ways
to open an account with Sharekhan Ltd.:

One need to call them at phone number provided below and asks that he want to open an
account with them.
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a. One can call on the Toll Free Number: 1-800-22-7500 to speak to a Customer
Service executive
b. Or If one stays in Mumbai, he can call on 022-66621111

One can visit any one of Sharekhan Limiteds nearest branches. Sharekhan has a huge
network all over India (640 centers in 280 cities). One can also log on to
http://sharekhan.com/Locateus.aspx link to find out the nearest branch.

One can send them an email at info@sharekhan.com to know about their products and
services.

One can also visit the site www.sharekhan.com and click on the option Open an
Account to fill a small query form which will ask the individual to give details regarding
his name, city he lives in, his email address, phone number, pin code of the city, his
nearest Sharekhan Ltd. shop and his preferences regarding the type of account he wants.

These information are compiled in the headquarter of the company that is in Mumbai from where
it is distributed throughout the countrys branches in the form of leads on the basis of cities and
nearest share shops. After that the executives of the respective branches contact the prospective
clients over phone or through email and give them information regarding the various types of
accounts and the documents they need to open an account and then fix appointment with the
prospective clients to give them demonstration and making them undergo the formalities to open
the account. After that the forms that has collected from the clients, is scrutinized in the branch
and then it is sent to Mumbai for further processing where after a few days the clients account
are generated and activated. After the accounts are activated, a Welcome Kit is dispatched from
Mumbai to the clients address mentioned in the documents provided by them. As soon as the
clients receive the Welcome Kit, which contains the clients Trading ID and Trading Password,
they can start trading and investing in shares.
Apart from two passport size photographs, one needs to provide with the following documents in
order to open an account with Sharekhan Limited.:

Photocopy of the clients PAN Card which should be duly attached

Photo copy of any of the following documents duly attached which will serve as
correspondence address proof:
a. Passport (valid)
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b. Voters ID Card
c. Ration Card
d. Driving License (valid)
e. Electricity Bill (should be latest and should be in the name of the client)
f. Telephone Bill (should be latest and should be in the name of the client)
g. Flat Maintenance Bill (should be latest and should be in the name of the client)
h. Insurance Policy (should be latest and should be in the name of the client)
i. Lease or Rent Agreement.
j. Saving Bank Statement** (should be latest)

Two cheques drawn in favor of Sharkhan Limited, one for the Account Opening Fees
and the other for the Margin Money (the minimum margin money is Rs. 5000).

** A cancelled cheque should be given by the client if he provides Saving Bank Statement
as a proof for correspondence address.
NOTE: Only Saving Bank Account cheques are accepted for the purpose of Opening an
account.

SERVICES:
1. Trading Facilities:
Sharekhan as a member of NSE& BSE provides both
offline and online trading facilities nationwide for
trading the securities in secondary market to its clients.
The companys wide network of outlets spread across

xxi

the country facilities to executive the orders in secondary market.

2. Derivatives: (Futures and Options)
The company also facilitates the trading system for trading in secondary market under future and
options segment of NSE and BSE. The equity dealers in the company will be eager to give
insights into the new sets introduction in the Indian
Capital Market futures and options.
3. Depository services:
Sharekhan is a Depository participant of National
Securities Depository Limited and Central Depository
and Securities Limited.
Sharekhan will open De-mat accounts, which will
investors to convert physical certificates of shares into
electronic balances in an account maintained.
4. Margin Financing:
In the present rolling settlement scenario, Sharekhan understand investor need for additional
capital availability for daily purchaser shares. It offers unique facility avail finance, for
purchasing shares at very competitive interest rates.

5. IPOs and Mutual Funds:

Sharekhan offers the change of investing in the potentially lucrative IPO market. Sharekhan is a
distribution house for all mutual funds. This is the news scheme introduced by the company and
it also offers schemes catering to investors with varying risk return profiles.
6.

Stock lending and Borrowing:

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One can place an order of shares with Sharekhan. It is approved intermediary of the
security or lending scheme. These would be sent out the borrowers, these earnings fees for all
investors idle shares. Thus Sharekhan fulfill the investor need for borrowing and lending of
shares.
7. Equity Research:
Sharekhan has a highly rated research using involved in
macroeconomic studies, industry and company specific
equity research. The research teams inputs will be
available as daily trading calls, quarterly investment picks
and long term investment picks, based on the fundamentals
of particular company and the industry as a whole.
8.

Internet Trading:

Investors can also trade their securities through this facility by logging into companys website.
The virtual world that Sharekhan offers online trading services through.
9.

Portfolio Management Services:

Sharekhan securities are a registered portfolio manager with SEBI to manage portfolios on
behalf of clients with a discretionary and non discretionary right.
This service is a provision for those who may not have the time to manage their stock
investments or require the service of companys highly specialized profession team.
10. Other Services:

Free access to investment advice from Share khans

research team

Sharekhan Value line (A monthly publication

with review of recommendations stocks to watch
out)

Daily research reports and market review ( high

noon and eagle eye)

Daily trading calls based technical analyses

xxiii

Cool trading products ( Daring derivatives and market strategy)

Personalized advice

Live management information

Internet- Based online trading

Online BSE & NSE executions through BOLT & NEAT terminals).

ONLINE TRADING

In online exchanges the trading is done on a computer network. The sellers and buyers log on to
the network and propose their bids. The system is designed in such a way that at any given
instance, the buyers/sellers are bidding at the best prices. The live quotes of the market are
available on the screen. The top bids are displayed. There is facility to buy and sell at the same
time.

xxiv

MAJOR PLAYERS IN ONLINE TRADING

SHAREKHAN.COM

5PAISA.COM

KOTAKSTREET.COM

INDIABULLS.COM

ICICIDIRECT.COM

HDFCS EC.COM

There are three types of trading:

Delivery trading

Margin trading

Day trading

Delivery Trading
In delivery base trading, you have Rs.100; you
buy the shares worth rs.100 and take delivery of
those shares.
Margin Trading
In margin trading, you have Rs.100; you buy the shares with 4 times the amount (i.e. Rs.400).
On T+2 day, you either arrange for borrowed amount or sell back the shares.
Day Trading
Day trading involves taking a position in the markets with a view of squaring that position before
the end of that day.
A day trader typically trades several times a day and the goal of a day trader is to capitalize on
price movement within one trading day. Unlike investors, a day trader may hold positions for
only a few seconds or minutes and never overnight. This is really the safest way to do day
trading because you are not exposed to the potential losses that can occur when stock market is
closed due to news that can affect the prices of your of your stocks.
xxv

In day trading, you have Rs.100; you buy shares 4-8 times the amount and make sure that you
square off at the end of day.

Online trading process

The various transactions involved in online trading can be shown from the point of view of the

Client

Broker

Stock Exchange

xxvi

BENEFITS OF ONLINE TRADING

Increase traders capacity in the stock exchange

Eliminate unmatched traders and delayed reporting

Speedy matching

Provide for online and offline monitoring, control and surveillance of the market

Single screen order without going through the hassles of giving transfer instruction,
writing cheques

Instant order/ trade confirmation gives you similar trading experience as exchange based
software without the burden of overhead and maintenance cost

A refreshing experience of getting outstanding research based advice on intraday and

delivery trades on the same screen

Live quotes of NSE-cash /derivative, BSE cash, commodity. Create multiple market
watches, default market watch NIFTY, SENSEX. You can add NSE-cash, Derivative
and BSE script on the same market watch

Get access to various online reports like margin reports, Demat account details, trade
executed, turnover report, net position report with mark to market profit/loss and realized
profit

View top 20 shares by value or volume traded, along with top gainers/ losers

COMPETITORS
The Indian retail brokerage market, which is going through a wonderful phase with high growth
rate expect the total trading volume of the Indian brokerage companies to reach US$ 6535.7
billion by the year 2015 which stood at US$ 1239.1 billion in the year 2004, and US$ 1492.1
billion in 2005.
Competitors for SHAREKHAN in India:
KARVY
KARVY, is premier integrated financial services provide, and ranked among the top five in the
country all its business segments, services over 16 million individual investors in various
capacities, and provide investor services to over 300 corporate, comparing the who is who of
corporate India. KARVY covers the entire spectrum of financial services such as Stock broking,
xxvii

Depository Participants, Distribution of financial products Mutual funds, Bonds, Fixed

Services, Merchant Banking & Corporate Finance, Placement of equity, IPOs among others.
Karvy has various industrial segments.

KOTAK SECURITIES
Kotak Mahindra is one of Indias leading financial institutions, offering complete financial
solutions that encompass every sphere of life. From commercial banking, to stock broking to
mutual funds, to life insurance, to investment banking, the group caters to the financial needs of
individuals and corporate. The group has a net worth of around Rs. 2000 crore and the AUM
across the

group is around 120 billion and employs over 6000 employees in its various

businesses. With a presence in 216 cities in India and offices New York, Landon, Dubai, and
Mauritius, it services a customer base of over 10,00,000. The group specializes in offering top
class financial services, catering to every segment of the industry.

INDIA INFOLINE:
The India Infoline Group comprises the holding the parent company, India Infoline Ltd owns and
manages the web properties www.indiainfoline.com and www.5paisa.com. It also undertakes
research, customized and off the shelf. Launched on 11 May 1999, www.indiainfoline.com is
Indias leading and most comprehensive business and financial information website. The site
provides quality information and analysis earlier restricted to a few people to the common
man, absolutely free.

INDIABULLS
The market capitalization of Indiabulls is around USD 1100 Million and consolidated net worth
of the company is around USD 725Million some of the large shareholders of Indiabulls are the
largest financial institutions of the worlds such as Fidelity Funds, Capital international, Goldman
Sachs, Merrill Lynch, Lloyd George and Feallon Capital. Revenue of the company grew at a
CAGR of 184% from FY06 to FY09 during the same period profit of the co grow at a CAGR of
215%.

OTHERS
-

IL & FS Investment Limited.

Motilal Oswal Securities.

xxviii

Reliance Money.

Angel Broking Limited.

Anandrathi Securities Limited

ACHIEVEMENTS AND AWARDS WON BY SHAREKHAN

Sharekhan, the retail broking arm of SSKI Group and one of the largest stock broking houses in
the country, has won the prestigious Awaaz Consumer Vote Awards 2005 for the Most Preferred
Stock Broking Brand in India, in the Investment Advisors category. This was Indias largest
Customer Study initiated by CNBC Awaaz and conducted by AC Nielson covering 7000
respondents, 21 products and services across 21 major cities.
Rated among the top 20 wired companies along with RELIANCE, HLL, and INFOSYSetc. by
Business Today.
ORG Marg award by CNBC.
India internet World 2008 for the Best Finance site.
Sharekhan online trading and investment site www.sharekhan.com was launched in 2000.
Sharekhan ground network includes over 250 centers across 123 cities in India and having
around 120000 customers and an equal number of demat customers.

FUTURE GROWTH AND PROSPECTS.

Mergers and acquisitions: In the highly competitive and over crowded market, shakeouts and
bankruptcies of online brokers can be anticipated. The trend is towards a gradual
consolidation of retail investors to a few dominant players or partnerships.
Stock broking applications that provided services in various delivery modes, i.e., internet,
WAP, palm pilots, pocket PCs etc will get more common as more and more people start
using these gadgets. Online broking would have a completely new meaning in this scenario.

xxix

 In a crowded stock broking industry, differentiation becomes the key to higher revenues.
Better service, straight through processing (STP), immediate execution, portfolio services,
investment advisors and telephone call centers or branch investment offices are needed to
retain customers and to increase the revenue base.

INTRODUCTION TO COMMODITY MARKET

What is Commodity?
Any product that can be used for commerce or an article of commerce which is traded on an
authorized commodity exchange is known as commodity. The article should be movable of
value, something which is bought or sold and which is produced or used as the subject or barter
or sale. In short commodity includes all kinds of goods. Indian Forward Contracts (Regulation)
Act (FCRA), 1952 defines goods as every kind of movable property other than actionable
claims, money and securities.
In current situation, all goods and products of agricultural (including plantation), mineral and
fossil origin are allowed for commodity trading recognized under the FCRA. The national
commodity exchanges, recognized by the Central Government, permits commodities which
include precious (gold and silver) and non-ferrous metals, cereals and pulses, ginned and unginned cotton, oilseeds, oils and oilcakes, raw jute and jute goods, sugar and gur, potatoes and
onions, coffee and tea, rubber and spices. Etc.

What is a commodity exchange?

A commodity exchange is an association or a company or any other body corporate organizing
futures trading in commodities for which license has been granted by regulating authority.

What is Commodity Future?

A Commodity futures is an agreement between two parties to buy or sell a specified and
standardized quantity of a commodity at a certain time in future at a price agreed upon at the
time of entering into the contract on the commodity futures exchange. The need for a futures
market arises mainly due to the hedging function that it can perform. Commodity markets, like
any other financial instrument, involve risk associated with frequent price volatility. The loss due
to price volatility can be attributed to the following reasons:
xxx

Consumer Preferences: - In the short-term, their influence on price volatility is small since it is
a slow process permitting manufacturers, dealers and wholesalers to adjust their inventory in
advance.
Changes in supply: - They are abrupt and unpredictable bringing about wild fluctuations in
prices. This can especially noticed in agricultural commodities where the weather plays a major
role in affecting the fortunes of people involved in this industry. The futures market has evolved
to neutralize such risks through a mechanism; namely hedging.
The objectives of Commodity futures:

Hedging with the objective of transferring risk related to the possession of physical assets
through any adverse moments in price. Liquidity and Price discovery to ensure base
minimum volume in trading of a commodity through market information and demand
supply factors that facilitates a regular and authentic price discovery mechanism.

Maintaining buffer stock and better allocation of resources as it augments reduction in

inventory requirement and thus the exposure to risks related with price fluctuation
declines. Resources can thus be diversified for investments.

Price stabilization along with balancing demand and supply position. Futures trading
leads to predictability in assessing the domestic prices, which maintains stability, thus
safeguarding against any short term adverse price movements. Liquidity in Contracts of
the commodities traded also ensures in maintaining the equilibrium between demand and
supply.

Flexibility, certainty and transparency in purchasing commodities facilitate bank

financing. Predictability in prices of commodity would lead to stability, which in turn
would eliminate the risks associated with running the business of trading commodities.
This would make funding easier and less stringent for banks to commodity market
players.

BENEFITS OF COMMODITY FUTURES MARKETS:The primary objectives of any futures exchange are authentic price discovery and an efficient
price risk management. The beneficiaries include those who trade in the commodities being
offered in the exchange as well as those who have nothing to do with futures trading. It is
because of price discovery and risk management through the existence of futures exchanges that
a lot of businesses and services are able to function smoothly.
xxxi

1. Price Discovery:-Based on inputs regarding specific market information, the demand

and supply equilibrium, weather forecasts, expert views and comments, inflation rates,
Government policies, market dynamics, hopes and fears, buyers and sellers conduct
trading at futures exchanges. This transforms in to continuous price discovery
mechanism. The execution of trade between buyers and sellers leads to assessment of fair
value of a particular commodity that is immediately disseminated on the trading terminal.

2.

Price Risk Management: - Hedging is the most common method of price risk
management. It is strategy of offering price risk that is inherent in spot market by taking
an equal but opposite position in the futures market. Futures markets are used as a mode
by hedgers to protect their business from adverse price change. This could dent the
profitability of their business. Hedging benefits who are involved in trading of
commodities like farmers, processors, merchandisers, manufacturers, exporters, importers
etc.

3.

Import- Export competitiveness: - The exporters can hedge their price risk and
improve their competitiveness by making use of futures market. A majority of traders
which are involved in physical trade internationally intend to buy forwards. The
purchases made from the physical market might expose them to the risk of price risk
resulting to losses. The existence of futures market would allow the exporters to hedge
their proposed purchase by temporarily substituting for actual purchase till the time is
ripe to buy in physical market. In the absence of futures market it will be meticulous,
time consuming and costly physical transactions.

4. Predictable Pricing: - The demand for certain commodities is highly price elastic. The
manufacturers have to ensure that the prices should be stable in order to protect their
market share with the free entry of imports. Futures contracts will enable predictability in
domestic prices. The manufacturers can, as a result, smooth out the influence of changes
in their input prices very easily. With no futures market, the manufacturer can be caught
between severe short-term price movements of oils and necessity to maintain price
stability, which could only be possible through sufficient financial reserves that could
otherwise be utilized for making other profitable investments.

xxxii

5. Benefits for farmers/Agriculturalists: - Price instability has a direct bearing on farmers

in the absence of futures market. There would be no need to have large reserves to cover
against unfavorable price fluctuations. This would reduce the risk premiums associated
with the marketing or processing margins enabling more returns on produce. Storing
more and being more active in the markets. The price information accessible to the
farmers determines the extent to which traders/processors increase price to them. Since
one of the objectives of futures exchange is to make available these prices as far as
possible, it is very likely to benefit the farmers. Also, due to the time lag between
planning and production, the market-determined price information disseminated by
futures exchanges would be crucial for their production decisions.

6. Credit accessibility: - The absence of proper risk management tools would attract the
marketing and processing of commodities to high-risk exposure making it risky business
activity to fund. Even a small movement in prices can eat up a huge proportion of capital
owned by traders, at times making it virtually impossible to pay back the loan. There is a
high degree of reluctance among banks to fund commodity traders, especially those who
do not manage price risks. If in case they do, the interest rate is likely to be high and
terms and conditions very stringent. This posses a huge obstacle in the smooth
functioning and competition of commodities market. Hedging, which is possible through
futures markets, would cut down the discount rate in commodity lending.

7. Improved product quality: - The existence of warehouses for facilitating delivery with
grading facilities along with other related benefits provides a very strong reason to
upgrade and enhance the quality of the commodity to grade that is acceptable by the
exchange. It ensures uniform standardization of commodity trade, including the terms of
quality standard: the quality certificates that are issued by the exchange-certified
warehouses have the potential to become the norm for physical trade.

HISTORY OF EVOLUTION OF COMMODITY MARKETS

Commodities future trading was evolved from need of assured continuous supply of seasonal
agricultural crops. The concept of organized trading in commodities evolved in Chicago, in
1848. But one can trace its roots in Japan. In Japan merchants used to store Rice in warehouses
for future use. To raise cash warehouse holders sold receipts against the stored rice. These were
xxxiii

known as rice tickets. Eventually, these rice tickets become accepted as a kind of commercial
currency. Latter on rules came in to being, to standardize the trading in rice tickets. In 19 th
century Chicago in United States had emerged as a major commercial hub. So that wheat
producers from Mid-west attracted here to sell their produce to dealers & distributors. Due to
lack of organized storage facilities, absence of uniform weighing & grading mechanisms
producers often confined to the mercy of dealers discretion. These situations lead to need of
establishing a common meeting place for farmers and dealers to transact in spot grain to deliver
wheat and receive cash in return.
Gradually sellers & buyers started making commitments to exchange the produce for cash in
future and thus contract for futures trading evolved. Whereby the producer would agree to sell
his produce to the buyer at a future delivery date at an agreed upon price. In this way producer
was aware of what price he would fetch for his produce and dealer would know about his cost
involved, in advance. This kind of agreement proved beneficial to both of them. As if dealer is
not interested in taking delivery of the produce, he could sell his contract to someone who needs
the same. Similarly producer who not intended to deliver his produce to dealer could pass on the
same responsibility to someone else. The price of such contract would dependent on the price
movements in the wheat market. Latter on by making some modifications these contracts
transformed in to an instrument to protect involved parties against adverse factors such as
unexpected price movements and unfavorable climatic factors. This promoted traders entry in
futures market, which had no intentions to buy or sell wheat but would purely speculate on price
movements in market to earn profit.
Trading of wheat in futures became very profitable which encouraged the entry of other
commodities in futures market. This created a platform for establishment of a body to regulate
and supervise these contracts. Thats why Chicago Board of Trade (CBOT) was established in
1848. In 1870 and 1880s the New York Coffee, Cotton and Produce Exchanges were born.
Agricultural commodities were mostly traded but as long as there are buyers and sellers, any
commodity can be traded. In 1872, a group of Manhattan dairy merchants got together to bring
chaotic condition in New York market to a system in terms of storage, pricing, and transfer of
agricultural products. In 1933, during the Great Depression, the Commodity Exchange, Inc. was
established in New York through the merger of four small exchanges the National Metal
Exchange, the Rubber Exchange of New York, the National Raw Silk Exchange, and the New
York Hide Exchange.

xxxiv

The largest commodity exchange in USA is Chicago Board of Trade, The Chicago Mercantile
Exchange, the New York Mercantile Exchange, the New York Commodity Exchange and New
York Coffee, sugar and cocoa Exchange. Worldwide there are major futures trading exchanges
in over twenty countries including Canada, England, India, France, Singapore, Japan, Australia
and New Zealand.

History of Commodity Market in India:The Commodity Futures market in India dates back to more than a century. The first organized
futures market was established in 1875, under the name of Bombay Cotton Trade Association
to trade in cotton derivative contracts. This was followed by institutions for futures trading in
oilseeds, food grains, etc. The futures market in India underwent rapid growth between the
period of First and Second World War. As a result, before the outbreak of the Second World
War, a large number of commodity exchanges trading futures contracts in several commodities
like cotton, groundnut, groundnut oil, raw jute, jute goods, castor seed, wheat, rice, sugar,
precious metals like gold and silver were flourishing throughout the country. In view of the
delicate supply situation of major commodities in the backdrop of war efforts mobilization,
futures trading came to be prohibited during the Second World War under the Defence of India
Act. After Independence, especially in the second half of the 1950s and first half of 1960s, the
commodity futures trading again picked up and there were thriving commodity markets.
However, in mid-1960s, commodity futures trading in most of the commodities was banned and
futures trading continued in two minor commodities, viz, pepper and turmeric.
The history of organized commodity derivatives in India goes back to the nineteenth century
when Cotton Trade Association started futures trading in 1875, about a decade after they started
in Chicago. Over the time datives market developed in several commodities in India. Following
Cotton, derivatives trading started in oilseed in Bombay (1900), raw jute and jute goods in
Calcutta (1912), Wheat in Hapur (1913) and Bullion in Bombay (1920).
However many feared that derivatives fuelled unnecessary speculation and were detrimental to
the healthy functioning of the market for the underlying commodities, resulting in to banning of
commodity options trading and cash settlement of commodities futures after independence in
1952. The parliament passed the Forward Contracts (Regulation) Act, 1952, which regulated
contracts in Commodities all over the India. The act prohibited options trading in Goods along
with cash settlement of forward trades, rendering a crushing blow to the commodity derivatives
xxxv

market. Under the act only those associations/exchanges, which are granted reorganization from
the Government, are allowed to organize forward trading in regulated commodities. The act
envisages three tire regulations: (i) Exchange which organizes forward trading in commodities
can regulate trading on day-to-day basis; (ii) Forward Markets Commission provides regulatory
oversight under the powers delegated to it by the central Government. (iii) The Central
Government- Department of Consumer Affairs, Ministry of Consumer Affairs, Food and Public
Distribution- is the ultimate regulatory authority.
The commodities future market remained dismantled and remained dormant for about four
decades until the new millennium when the Government, in a complete change in a policy,
started actively encouraging commodity market. After Liberalization and Globalization in 1990,
the Government set up a committee (1993) to examine the role of futures trading. The
Committee (headed by Prof. K.N. Kabra) recommended allowing futures trading in 17
commodity groups. It also recommended strengthening Forward Markets Commission, and
certain amendments to Forward Contracts (Regulation) Act 1952, particularly allowing option
trading in goods and registration of brokers with Forward Markets Commission.

The

Government accepted most of these recommendations and futures trading was permitted in all
recommended commodities. It is timely decision since internationally the commodity cycle is on
upswing and the next decade being touched as the decade of Commodities.
Commodity exchange in India plays an important role where the prices of any commodity are
not fixed, in an organized way. Earlier only the buyer of produce and its seller in the market
judged upon the prices. Others never had a say.
Today, commodity exchanges are purely speculative in nature. Before discovering the price,
they reach to the producers, end-users, and even the retail investors, at a grassroots level. It
brings a price transparency and risk management in the vital market. A big difference between a
typical auction, where a single auctioneer announces the bids and the Exchange is that people are
not only competing to buy but also to sell. By Exchange rules and by law, no one can bid under a
higher bid, and no one can offer to sell higher than someone elses lower offer. That keeps the
market as efficient as possible, and keeps the traders on their toes to make sure no one gets the
purchase or sale before they do. Since 2002, the commodities future market in India has
experienced an unexpected boom in terms of modern exchanges, number of commodities
allowed for derivatives trading as well as the value of futures trading in commodities, which
crossed $ 1 trillion mark in 2006. Since 1952 till 2002 commodity datives market was virtually
non- existent, except some negligible activities on OTC basis.
xxxvi

In India there are 25 recognized future exchanges, of which there are three national level multicommodity exchanges. After a gap of almost three decades, Government of India has allowed
forward transactions in commodities through Online Commodity Exchanges, a modification of
traditional business known as Adhat and Vayda Vyapar to facilitate better risk coverage and
delivery of commodities. The three exchanges are: National Commodity & Derivatives
Exchange Limited (NCDEX) Mumbai, Multi Commodity Exchange of India Limited (MCX)
Mumbai and National Multi-Commodity Exchange of India Limited (NMCEIL) Ahmedabad.
There are other regional commodity exchanges situated in different parts of India.

Legal framework for regulating commodity futures in India:The commodity futures traded in commodity exchanges are regulated by the Government under
the Forward Contracts Regulations Act, 1952 and the Rules framed there under. The regulator
for the commodities trading is the Forward Markets Commission, situated at Mumbai, which
comes under the Ministry of Consumer Affairs Food and Public Distribution

Forward Markets Commission (FMC):It is statutory institution set up in 1953 under Forward Contracts (Regulation) Act, 1952.
Commission consists of minimum two and maximum four members appointed by Central Govt.
Out of these members there is one nominated chairman. All the exchanges have been set up
under overall control of Forward Market Commission (FMC) of Government of India.
There are 21 Commodity Exchanges (15 Regional and 6 National Exchanges) regulating futures
trading in commodities under the purview of the Forward Markets Commission (FMC). The
country's commodity futures exchanges are divided majorly into two categories:

National exchanges

Regional exchanges

The FIVE exchanges operating at the national level (as on ) are:

i)

National Commodity and Derivatives Exchange of India Ltd. (NCDEX)

ii)

National Multi Commodity Exchange of India Ltd. (NMCE)

iii)

Multi Commodity Exchange of India Ltd. (MCX)

iv)

Indian Commodity Exchange Ltd. (ICEX) which started trading operations on

November 27, 2009
xxxvii

v)

ACE Derivatives and Commodity Exchange

The leading regional exchange is the National Board of Trade (NBOT) located at Indore. There
are more than 15 regional commodity exchanges in India.

National Commodities & Derivatives Exchange Limited (NCDEX)

National Commodities & Derivatives Exchange Limited (NCDEX) promoted by ICICI Bank
Limited (ICICI Bank), Life Insurance Corporation of India (LIC), National Bank of Agriculture
and Rural Development (NABARD) and National Stock Exchange of India Limited (NSC).
Punjab National Bank (PNB), Credit Rating Information Service of India Limited (CRISIL),
Indian Farmers Fertilizer Cooperative Limited (IFFCO), Canara Bank and Goldman Sachs by
subscribing to the equity shares have joined the promoters as a shareholder of exchange.
NCDEX is the only Commodity Exchange in the country promoted by national level institutions.
NCDEX is a public limited company incorporated on 23 April 2003. NCDEX is a national level
technology driven on line Commodity Exchange with an independent Board of Directors and
professionals not having any vested interest in Commodity Markets.
It is committed to provide a world class commodity exchange platform for market participants to
trade in a wide spectrum of commodity derivatives driven by best global practices,
professionalism and transparency.
NCDEX is regulated by Forward Markets Commission (FMC). NCDEX is also subjected to the
various laws of land like the Companies Act, Stamp Act, Contracts Act, Forward Contracts
Regulation Act and various other legislations.
NCDEX is located in Mumbai and offers facilities to its members in more than 550 centers
throughout India. NCDEX currently facilitates trading of 57 commodities.

Multi Commodity Exchange of India Limited (MCX)

Multi Commodity Exchange of India Limited (MCX) is an independent and de-mutulized
exchange with permanent reorganization from Government of India, having Head Quarter in
Mumbai. Key shareholders of MCX are Financial Technologies (India) Limited, State Bank of
India, Union Bank of India, Corporation Bank of India, Bank of India and Canara Bank. MCX
facilitates online trading, clearing and settlement operations for commodity futures market across
the country. MCX started of trade in Nov 2003 and has built strategic alliance with Bombay
xxxviii

Bullion Association, Bombay Metal Exchange, Solvent Extractors Association of India, pulses
Importers Association and Shetkari Sanghatana.MCX deals with about 100 commodities.

National Multi Commodity Exchange of India Limited (NMCEIL)

National Multi Commodity Exchange of India Limited (NMCEIL) is the first de-mutualised
Electronic Multi Commodity Exchange in India. On 25th July 2001 it was granted approval by
Government to organize trading in edible oil complex. It is being supported by Central
warehousing Corporation Limited, Gujarat State Agricultural Marketing Board and Neptune
Overseas Limited. It got reorganization in Oct 2002. NMCEIL Head Quarter is at Ahmedabad.
Some of the features of national and regional exchanges are listed below:
National Exchanges

Compulsory online trading

Transparent trading

Exchange recognized on permanent basis

Multi commodity exchange

Large expanding volumes

Regional Exchanges

Online trading not compulsory

Recognition given for fixed period after which it could be given for re-regulation

Generally, these are single commodity exchanges. Exchanges have to apply for trading
each commodity.

Low volumes in niche markets

Figure 1.1

xxxix

Table 1.1 Commodity Exchanges in India and commodities traded

No. Exchanges

Main Commodities

Gold, Silver, Copper, Crude Oil, Zinc, Lead, Nickel,

1 Multi Commodity

Natural gas,

Exchange of India Ltd.,

Aluminium, Mentha Oil, Crude_Palm_Oil, Refined

Mumbai*

Soya Oil, Cardamom, Guar Seeds, Kapas, Potato,

Chana\Gram, Melted Menthol Flakes, Almond, Wheat,
Barley, Long Steel, Maize, Soybean Seeds, Gasoline US,
Tin, Kapaskhali, Platinum, Heating Oil

2 National Commodity &

Guar Seed, Soy Bean, Soy Oil, Chana,RM Seed, Jeera,

Derivatives Exchange Ltd,

Turmeric, Guar Gum, Pepper, Cotton Cake, Long Steel,

Mumbai*

Gur, Kapas, Wheat, Red Chilli, Crude Oil, Maize, Gold,

Copper, Castor Seeds, Potato, Barley, Kachhi Ghani
Mustard Oil, Silver, Indian 28 Mm Cotton, Platinum

3 National Multi Commodity Rape/Mustard Seed, Guar Seeds, Nickel, Jute, Refined
Exchange of India

Soya Oil, Zinc, Rubber, Chana\Gram, Isabgul, Lead, Gold,

Limited, Ahmedabad*

Aluminium, Copper, Turmeric, Copra, Silver, Raw Jute,

Guar Gum, Pepper, Coffee Robusta, Castor Seeds, Mentha
Oil

xl

How Commodity market works?

There are two kinds of trades in commodities. The first is the spot trade, in which one pays cash
and carries away the goods. The second is futures trade. The underpinning for futures is the
warehouse receipt. A person deposits certain amount of say, good X in a ware house and gets a
warehouse receipt. Which allows him to ask for physical delivery of the good from the
warehouse. But someone trading in commodity futures need not necessarily posses such a receipt
to strike a deal. A person can buy or sale a commodity future on an exchange based on his
expectation of where the price will go. Futures have something called an expiry date, by when
the buyer or seller either closes (square off) his account or give/take delivery of the commodity.
The broker maintains an account of all dealing parties in which the daily profit or loss due to
changes in the futures price is recorded. Squiring off is done by taking an opposite contract so
that the net outstanding is nil.
For commodity futures to work, the seller should be able to deposit the commodity at warehouse
nearest to him and collect the warehouse receipt. The buyer should be able to take physical
delivery at a location of his choice on presenting the warehouse receipt. But at present in India
very few warehouses provide delivery for specific commodities.

Figure 1.2 Following diagram gives a fair idea about working of the Commodity market.

xli

Today Commodity trading system is fully computerized. Traders need not visit a commodity
market to speculate. With online commodity trading they could sit in the confines of their home
or office and call the shots.

The commodity trading system consists of certain prescribed steps or stages as follows:
I. Trading: - At this stage the following is the system implemented-

Order receiving

Execution

Matching

Reporting

Surveillance

Price limits

Position limits

II. Clearing: - This stage has following system in place-

Matching

Registration

Clearing

Clearing limits

Notation

Margining

Price limits

Position limits

Clearing house.

III. Settlement: - This stage has following system followed as follows-

Marking to market

Receipts and payments

Reporting

Delivery upon expiration or maturity.

Current Scenario in Indian Commodity Market

Need of Commodity Derivatives for India:xlii

India is among top 5 producers of most of the Commodities, in addition to being a major
consumer of bullion and energy products. Agriculture contributes about 22% GDP of Indian
economy. It employees around 57% of the labor force on total of 163 million hectors of land
Agriculture sector is an important factor in achieving a GDP growth of 8-10%. All this indicates
that India can be promoted as a major centre for trading of commodity derivatives.

Table 1.2 Commodity Futures Trade in India (Rs Lakhs Crores)

Category

for April to February FY2013-14

Total

157.828

Bullion

73.26

Agro

20.203

Metals

29.951

Energy

34.4

According to Forward Markets Commission (FMC), the value of commodities traded from April
to February 15, 2011-12 was recorded at Rs 159.324 lakh crore in comparison to the value of
commodities traded from April to February FY 2013-14 was recorded at Rs 157.828 lakh crore,
suggesting decline in trading activity in 2012-13.

Trends in volume contribution on the three National Exchanges:Pattern on Multi Commodity Exchange (MCX):MCX is currently largest commodity exchange in the country in terms of trade volumes, further
it has even become the third largest in bullion and second largest in silver future trading in the
world. Coming to trade pattern, though there are about 100 commodities traded on MCX, only 3
or 4 commodities contribute for more than 80 percent of total trade volume. As per recent data
the largely traded commodities are Gold, Silver, Energy and base Metals. Incidentally the
futures trends of these commodities are mainly driven by international futures prices rather than
the changes in domestic demand-supply and hence, the price signals largely reflect international
scenario. Among Agricultural commodities major volume contributors include Gur, Urad,
Menthol Oil etc. Whose market sizes are considerably small making then vulnerable to
manipulations. MCX is Indias leading commodity futures exchange with a market share of 87.3
per cent in terms of the value of commodity futures contracts traded in FY 2012-13. The
Exchange was the third largest commodity futures exchange in the world, in terms of the number
xliii

of contracts traded in CY2012, based on the Futures Industry Associations annual volume
survey released in March 2013. Moreover, as per the survey, during CY 2012, MCX was the
world's largest exchange in silver and gold futures, second largest in copper and natural gas
futures, and the third largest in crude oil futures. MCX has forged strategic alliances with leading
international exchanges such as CME Group, London Metal Exchange (LME), Shanghai Futures
Exchange (SHFE) and Taiwan Futures Exchange (TAIFEX). The Exchange has also tied-up with
various trade bodies, corporate, educational institutions and R&D centers across the country.
These alliances enable the Exchange in improving trade practices, increasing awareness, and
facilitating overall improvement of commodity futures market.

Pattern on National Commodity & Derivatives Exchange (NCDEX):NCDEX is the second largest commodity exchange in the country after MCX. However the
major volume contributors on NCDEX are agricultural commodities. But, most of them have
common inherent problem of small market size, which is making them vulnerable to market
manipulations and over speculation. About 60 percent trade on NCDEX comes from guar seed,
channa and Urad (narrow commodities as specified by FMC).

Pattern on National Multi Commodity Exchange (NMCE):NMCE is third national level futures exchange that has been largely trading in Agricultural
Commodities. Trade on NMCE had considerable proportion of commodities with big market size
as jute rubber etc. But, in subsequent period, the pattern has changed and slowly moved towards
commodities with small market size or narrow commodities.
Analysis of volume contributions on three major national commodity exchanges reveled the
following pattern,
Major volume contributors: - Majority of trade has been concentrated in few commodities that
are
Non Agricultural Commodities (bullion, metals and energy)
Agricultural commodities with small market size (or narrow commodities) like guar, Urad,
Menthol etc.
As of March 2012, futures trading in urad, tur and rice remain suspended.

xliv

During the period under review (January 2013 to March 2013), the total value of trade in all
commodities traded at the recognized Exchanges was `40.84 lakh crore as against `41.99 lakh
crore during the previous quarter (October 2012 to December 2012) and `44.03 lakh crore
during the corresponding period of last year.
The five major commodity exchanges contributed 99.63 % to the total value of trade in the
Commodity futures market. These are MCX, Mumbai (88.31 %), NCDEX, Mumbai (7.15
%), NMCE, Ahmedabad (1.52 %), ICEX, Mumbai (1.83 %), and ACE Derivatives and
Commodity Exchange Ltd., Mumbai (0.82%).

Table 1.3 Total volume and value of trade during the quarter (January 2013 to March 2013) in
the major commodity exchanges
Volume of
Name of Exchange

Value (` in

Trade

% share (In
value

(In lakh tons)

Crore)

terms)

2284.77

3606867.16

88.31

678.79

292014.68

7.15

84.21

61967.85

1.52

136.08

75131.51

1.83

56.20

33428.45

0.82

Total of top 5 exchanges

3240.05

4069409.65

99.63

Others

32.24

14982.82

0.37

Grand total

3272.29

4084392.47

100.00

Multi Commodity Exchange of India

Ltd., Mumbai
National Commodity & Derivatives
Exchange Ltd., Mumbai
National Multi Commodity Exchange
of India Ltd., Ahmedabad
Indian Commodity Exchange Ltd.,
Mumbai
ACE Derivatives & Commodity
Exchange Ltd., Mumbai

Note: Natural Gas volumes are not included in the Total Volume
xlv

During the period under review Silver, Gold, Crude Oil, Copper, Natural Gas, Lead, Zinc &
Nickel contracts constituted a major share of the value of commodities traded at the MCX,
Mumbai. The following table indicates the % share of major commodities traded at MCX,
Mumbai, during the period under review.

Table 1.4 Top commodities traded on MCX during the quarter (January 2013 to March 2013)

Commodities

Total value
% share to the total value
(In ` crores)

SILVER

936279.660

25.96

GOLD

906262.427

25.13

CRUDEOIL

653661.839

18.12

COPPER

293087.998

8.13

NATURAL GAS

221621.380

6.14

LEAD

212341.570

5.89

ZINC

137550.888

3.81

NICKEL

101419.834

2.81

Total of major commodities 3462225.596

95.99

Other commodities

144641.563

4.01

Total

3606867.158

100.00

xlvi

During the period under review Soy Oil, Soya Bean, Castor Seed, Dhaniya, R/M Seed, Chana,
Cotton Seed Oil Cake, Kapas, Jeera & Turmeric constituted a major share of the value of
commodities traded at the NCDEX, Mumbai.The following table indicates the % share of major
commodities traded at NCDEX, Mumbai during the period under review.

Table 1.5 Top commodities traded on NCDEX during the quarter (January 2013 to March 2013)

Commodities

Total value

% share to the total value

(In `crores)
SOYA_OIL

101121.123

34.63

SOYABEAN

39302.174

13.46

CASTOR_SEED

24150.850

8.27

DHANIYA

22826.798

7.82

R/M SEED

17693.340

6.06

CHANA

16396.567

5.61

COTTON_CAKE

15867.319

5.43

KAPAS

13025.696

4.46

JEERA

10493.146

3.59

TURMERIC

10022.351

3.43

Total of major commodities 270899.364

92.769

Other commodities

21115.320

7.23

Total

292014.684

100.00

47

During the period under review Raw Jute, coffee Rep Bulk, Nickel, copper and Lead constituted
a major share of the value of commodities traded at the NMCE, Ahmedabad. The following table
indicates the % share of major commodities traded at NMCE, Ahmedabad during the period
under review.
Table 1.6 Top commodities traded on NMCE during the quarter (January 2014 to March 2014)

% share to the
Commodities

Total Value in `Crore

total value

RAW JUTE

5992.41

9.67

COFFEE REP BULK

5633.35

9.09

NICKEL

4223.85

6.82

COPPER

4236.62

6.84

LEAD

4150.76

6.70

Commodities

24236.99

39.11

Others Commodities

37730.86

60.89

Total

61967.851

100.00

Total of Major

48

During the period under review Natural Gas, Crude Oil, Silver, Copper, Iron ore, Lead, & Gold
constituted a major share of the value of commodities traded at the ICEX, Mumbai. The
following table indicates the % share of major commodities traded at ICEX, Mumbai during the
period under review.

Table 1.7 Top commodities traded on ICEX during the quarter (January 2014 to March 2014)

Commodities

Total value
% share to the total value
(In ` crores)

NATURAL GAS

29145.559

38.79

CRUDEOIL

12037.273

16.02

SILVER

8992.213

11.97

COPPERCATHODE

8785.815

11.69

IRONORE62FINES

7554.096

10.05

LEAD

5977.320

7.96

GOLD

2625.347

3.49

Total of major commodities 75117.621

99.98

Other commodities

13.883

0.02

Total

75131.504

100.00

Note: Natural Gas volumes are not included in the Total Volume

49

During the period under review Soy Oil, RBD, Soya Meal & Cotton constituted a major share of
the value of commodities traded at the ACE, Mumbai. The following table indicates the % share
of major commodities traded at ACE, Mumbai during the period under review.

Table 1.8 Top commodities traded on ACE during the quarter (January 2014 to March 2014)

Total value

% share to the total

(In `crores)

Value

Commodities

REFSOYOIL

23916.861

71.55

RBD

2905.998

8.69

SOYMEAL

2499.456

7.48

COTTON118

2455.443

7.35

31777.758

95.06

Other commodities

1650.690

4.94

Total

33428.448

100.00

Total of major

commodities

50

Chapter 2: Literature Review

51

(UNCTAD,5 June 2011) ,The major findings in this article was laid on the functioning
of commodity markets and the flow of information that affect the trading decisions. The
paper also summarizes the recent developments and trends in fundaments on both the
demand and supply side. They have urged that due to increase in the number of investors
in commodity market who do not base their trading purely on the basis of demand and
supply has lead to misleading price signals in the market . Another finding in this paper
was that investors want to diversify their portfolio which is playing an important role for
them to invest in commodity market rather than understanding the fundamentals for
investment.

(Ke Tang and Wei Xiong, March 2011),The primary objective of this paper was to find
out the effect growing investment in commodity futures markets has had on commodity
price co-movements. In order to find out the relationship between the two the authors
conducted a regression test between the oil and selected commodities from various
sectors and the major finding was that with the increase in investment by investors
observed since the early 2000s futures prices of non-energy commodities have become
increasingly correlated with oil.

(John Baffes and Tassos Haniotis ,July 2010),The main objective of this paper was to
analyze three potentially key factors behind recent commodity price increases: excess
liquidity and speculation, increasing food demand by emerging economies and the use of
some food commodities for biofuel production. The major findings in this paper was
speculation played a key role during the 2008 price rise whereas the use of some food
commodities for biofuel production played a small role and the increase in food demand
by emerging economies played no noticeable role.

(Lutz Kilian and Dan Murphy, 16 March 2010), The main objective of this study was
to develop a structural vector autoregressive (VAR) model of the global oil market. The
major findings of this study was that the increase in oil prices observed from 2003 to
2008 was caused by fluctuations in the flow demand for oil driven by the global business
cycle. The model also suggests that speculative trading played an important role during
oil price shocks observed in 1979, 1986 and 1990.
52

(Christopher Gilbert, March 2010),Main purpose of this study was to quantify the
effect of bubble
index-based

behavior, possibly resulting from extrapolative expectations and

investment on commodity futures prices between 2006 and 2000.The

findings of this study was that both bubble behavior and index investments have had a
substantial impact on commodity futures prices.

(Jeffrey Currie, Allison Nathan, David Greely and Damien Courvalin, 30 March
2010) ,The major findings of this study was that commodity price movements can be
explained by increasing marginal costs in the long term and fluctuations in inventories in
the short term. The authors also find speculative investors contributed to increased price
levels and price volatility in recent years noting as speculators buy, prices generally tend
to rise, and vice versa. Also the author points out that there is close relationship between
price volatility, inventories and storage capacity, as inventories help in closing the gap
between physical supply and demand.

(Scott Irwin and Dwight Sanders, 2010),The paper aims to test whether the major
growth in index funds has increased price volatility in both agricultural and energy
markets and, in particular, whether they helped cause a commodity price bubble in 200608.The findings of this study was that there were no strong evidence that index funds
caused a price bubble in commodity futures markets. The authors also find increasing
index fund positions are consistently associated with declining price volatility and this
paper gives a reasonable explanation for this negative correlation arguing speculation
helps to provide sufficient liquidity for hedging needs.

(International Monetary Fund, October 2008),The basic output of this study was that
strong demand from emerging economies, low capacity, low inventories resulting in slow
supply responses and the interaction between these factors have been the primary causes
of the surge in commodity prices observed in the first half of 2008. In addition, demand
for biofuel, supply disruptions and trade restrictions have caused food prices to surge
even higher. The authors also note that this price momentum may have been reinforced
by increased cross-commodity price linkages.

53

(Dwight Sanders, Scott Irwin and Robert Merrin, 1 January 2010), Under this study
the author brings out two important findings in agriculture futures market since 1995,
firstly a rapid increase in open interest since late 2004 and a stabilization of index funds
percentage of open interest since 2006.

(Gary Gorton and K. Geert Rouwenhorst ,March/April 2006),This paper concludes

that commodity futures returns have provided effective diversification for stock and
bond portfolios. Commodity futures have offered the same return and risk premium as
equities over the study period and are negatively correlated with equity and bond returns
due to different behavior over the business cycle and positively correlated with inflation,
unexpected inflation and changes in expected inflation.

54

CHAPTER 3: RESEARCH METHODOLOGY

55

1. Objectives of research:
To study the behavior of the individuals, their perspective, investment preference
for commodity market trading in India as compared to other financial markets in
India.
To study the operation and functioning of commodity market.

2. Research Design: Exploratory design has been selected as data has been collected from
the secondary sources in order to understand the functioning of commodity market and
data has been collected from primary source in order to satisfy the research objectives.

3. Data Collection Method: Most of the data has collected from secondary sources
whereas for conduct of research the primary data has been collected through a structured
questionnaire wherein a total of 130 respondents took part out of which only 100 have
been taken into consideration as the questionnaire pertains to a specific class of
respondents, so in order to reduce the error this has been done. A total of 63 males and 37
females have been included in the research.

4. Sampling: The study mainly deals with the financial behavior of Individual Investors
towards Commodity market in India. The required data was collected through a pretested
questionnaire administered on a combination of convenience and judgment sample of
100 individual investors. Judgment sample selection is due to the time. Respondents were
screened and inclusion was purely on the basis of their knowledge about Financial
Markets, Commodity market in particular. This was necessary, because the questionnaire
presumed awareness of some basic terminology about Commodity market. The purpose
of the survey was to understand the behavioral aspects of individual investors, mainly
their fund selection behavior, various factors influencing this behavior and also the
conceptual awareness level among individual investors. Sample of the questionnaire is
given in Annex. A.

5. Instruments used: The primary data was collected through a structured questionnaire by
one to one interactions with investors and contact was also made through emails.
56

6. Analysis and Interpretations: The analysis of the data collected has been performed
appropriately and inferences have been drawn.

7. Limitations of the study:

Sample size is limited to 100 educated individual investors. The sample size may not
adequately represent the national market.
Simple Random and judgment sampling techniques is due to time constraints.
This study has not been conducted over an extended period of time having both ups and
downs of stock market conditions which a significant influence on investor s buying
pattern and preferences.
The research is only exploratory, no conclusion may finally be drawn from it, but only
direction may be sought.
This is an independent study and the observations may not comply with those which have
been made by an experienced professional.

57

CHAPTER 4: Analysis and Interpretation

58

1) ANALYSIS OF INVESTORS PREFERENCES

The survey was conducted to capture investor objective for investment in financial instruments,
reveals the following.

Graph 4.1
High growth

66

Tax benefits

22

Retirement protection

10

Future welfare

75

Reasonable income and safety

63

Stable income

17

High income

25
0

10

20

30

40

50

60

70

80

FREQUENCY

Most of the investors want to invest money for the purpose of future welfare followed by high
growth, so company should suggest those instruments which have a positive return for their
investment which will help in fulfilling both the objectives.

59

2) CURRENT INVESTORS PREFERENCE OF INDIVIDUAL INVESTORS TOWARDS

THE FOLLOWING FINANCIAL MARKETS, IN THE INDIAN CAPITAL MARKET

Graph 4.2
100

90

84

79

80
60
40
15

20

0
Equity
market

Commodity
market

Currency
market

Real estate Mutual funds

Frequency

From the above analysis we can infer that majority of the people invest in Equity market, while
the investment in Commodity market and Mutual funds are almost similar, so therefore investors
are inclined more towards the share market.

60

3) CURRENT ATTITUDE OF INDIVIDUAL INVESTORS TOWARDS THE

FOLLOWING FINANCIAL MARKETS, IN THE INDIAN CAPITAL MARKET
Graph 4.3

Chart Title
Equity

Commodity

Currency

24

79

Mutual fund
1

13

Real estate

61

18
7
0

8
3

61

21
78
66

23

Highly favourable

Favourable

1
12
9

Somewhat
favourable

1
1

Not very favourable Not at all favourable

According to the analysis, we can see that most of the investors are favorable towards Mutual
fund under current market scenario followed by Commodity market and somewhat favorable
towards Equity market. So, it can be said that investors are looking for safe investment options
along with safe return which can be used as a motivation factor for investors to lure them in
investing in commodity market. According to the recent reports commodity market are the first
to revive for current situation which add as an added incentive for investors to invest in this
market as returns are going to be favorable.

61

4) PREFERENCE OF INVESTORS INVESTING IN COMMODITY MARKET

Graph 4.4

Frequency
2%

Bullions

24%

Agro products
Energy

58%

16%

Metals

From the above analysis we can clearly identify that Bullions i.e. Gold and Silver are the most
favored commodities to be traded in followed by Energy products such as Crude oil, Petroleum.

5) INDEX PREFERENCE OF INVESTORS

Graph 4.5

Frequency
1%

29%

MCX
NCDEX
NCFM

70%

62

Mostly investors prefer to deal on NCDEX platform even though MCX platform being the
largest platform for Commodity trading in India.

6) WHY PEOPLE RESIST IN INVESTING IN COMMODITY MARKET

Graph 4.6

Frequency
0%

Lack of knowledge

23%
Difficulty in
understanding

38%

Increase speculation
Very risky

39%

According to this analysis we can infer that people who already trade in Commodity market have
a perception that perspective investors are not attracted towards Commodity market primarily
because of difficulty in understanding as well as lack of knowledge of Commodity market, so the
investing companies can resort to various methods to inform these perspective investors and
convert them to real investors.

63

7) SOURCE OF INFORMATION TO INVESTORS

Graph 4.7

Axis Title

Frequency
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

Frequency

Referenc
e groups
61

Newspap Newspap Financial

ers(Gene ares(Busi magazine
ral)
ness)
s
1
87
20

Televisio
n

Brokers/
Agents

Internet

63

87

From the above analysis we can infer that most of the investors are gathering data from
newspapers and from the brokers/agents.

64

8) RATINGS OF INVESTORS FOR COMMODITY MARKET ON VARIOUS

ATTRIBUTES.
Graph 4.8

70
60
50
40

Very low
Low

30

Neutral

20

High
10

very high

In the above chart we can clearly see that investors perceives that tier id high Liquidity,
Flexibility and Good returns in the commodity market whereas most of the investors feel that
there is lack of Safety in commodity market. Under the category of diversification it is almost
equal so investors think that commodity market plays a role to a certain extent in diversification
but not too a great extent. Lastly, investors are not very favorable towards capital appreciation
due to investment in commodity market.

65

CHAPTER 5: CONCLUSION and RECOMMENDATIONS

66

This decade is termed as "Decade for Commodities". Since the economic slowdown all over the
world, the first scenes of recovery have been witnessed in commodity market. It was in 2010 that
when the prices of commodity markets were on a rise after recession which triggered a revival of
many economies such as USA, UK , India , China etc. Now the trend for commodity market is
shifting to developing countries like India due to high agricultural dependence and production.
Moreover, in coming years China will take over USA in commodity trading all over the world
and India will jump to 3rd place this will be because of high and growing population which will
lead to increase in demand for agriculture products and if we see the trend the overall yield per
hectare is also increasing for the last decade.

India is one of the top producers of large number of commodities and also has a long history of
trading in commodities and related derivatives. The Commodities Derivatives market has seen
ups and downs, but seems to have finally arrived now. The market has made enormous progress
in terms of Technology, transparency and trading activity. As majority of Indian investors are not
aware of organized commodity market; their perception about it is of risky to very risky
investment. Many of them have wrong impression about commodity market in their minds. It
makes them specious towards commodity market. So, there is a large or vast amount of untapped
market in India in both urban as well as rural sectors and regulatory bodies have to play a major
role in tapping these markets and luring investors to invest in commodity market.

It is also believed that Indians have a high risk appetite. So, There is no doubt that in near future
commodity market will become hot spot for Indian farmers rather than spot market. And
producers, traders as well as consumers will be benefited from it. But for this to happen one has
to take initiative to standardize and popularize the Commodity Market.

So, one can conclude on the basis of the analysis that have been carried out that investors in
current scenario i.e. with the burden of fall in rupee, increase inflation and high volatility have
changed their objectives to Reasonable income along with safety for the purpose of future
welfare as future looks uncertain. Now a day's investors are willing to bear very minimum risk
67

and that too for short span of period and most of the investors are inclined to invest their money
in mutual funds and commodity market. The attitude of investors towards mutual fund
investment is much more favorable than any other market as there is offer of around 12-14%
guaranteed return which if brought about in commodity market can lead to tapping of huge
untapped market.

Investors are willing to invest only in bullions (gold, silver) as their prices tend to raise over a
time horizon and due to lack of knowledge other areas of commodity market as not favored upon
as compared to international market where large amount of money is invested in agriculture
based products. In order to increase investment in commodity market the regulators have to take
initiative to educate and inform mass people about the working of commodity market and ensure
strict rules and regulations for investors safety which is a major concern these days.
At last the major findings of this study are that investors are reluctant to invest in commodity
market due to lack of knowledge ad difficulty in understanding the functioning of commodity
market and the major area of concern for investors is the safety driven by the objective of
reasonable income for future welfare.

68

Recommendations:i)

The Commodity market operational environment is becoming more competitive.

Hence, the impact of emerging competition on investor behavior/behavioral changes
needs to be studied further.

ii)

Developments in technology influence the behavior of investors. Hence, the impact of

technology on financial behavior is another potential area for close study.

iii)

Since the industry is still struggling to win the investors confidence, in-depth
analysis into investors expectations from Commodity market, its performance,
management, service and other related areas could be done.

iv)

This study reveals that Commodity market investors feel that currently the two major
benefits, which Commodity market claim to offer, namely, Diversification and Safety
are not satisfactorily delivered. In spite of this, Commodity market industry is
growing and we attribute this to investor behavior and other macroeconomic factors.
Further research can be done to understand the reasons for growing popularity on one
side and the struggle to win investors confidence on the other side.

v)

As we have seen from this study that Commodity market is on a rise in terms of
value, so a study can be conducted further to understand the untapped market.

vi)

This study was conducted during less volatile period of market, a further research can
be conducted on commodity market taking into consideration a long period where
volatility can also be taken into consideration and more meaningful conclusions can
be drawn.

69

REFERENCES

Websites:
www.bse.com
www.nseindia.com
www.moneycontrol.com/index
articles.economictimes.indiatimes.com/keyword/commodity_market (Economic times,
2013)
blog.euromonitor.com/2012/04/monthly-review-of-commodity-markets-april-2012update.html
businesstoday.intoday.in/story/top-commodities
businesstoday.intodayin/story/indias-commodity-market-to-register-gains/1/15682.html
commodities.about.com/old/managingourportfolio/a/commodities-Review-For-2012.htm
en.wikipedia.org/wiki/commodity_market
www.bseindia.com/education/content/module_ncfm.htm
www.commodityonline.com/Futures-trading/market-report/Indiacommodity.futures.trade.value-at-Rs.157.828-lakhs-cr-inAprilFeb.2012-13:Fmc29536.html
www.globalresearch.co/india-commodity-transaction
www.icexindia.com
www.imf.org/external/np/res/commod/Commodity_Market_review1012.pdf
www.indiainfoline.com/Markets/News/MarketNews/Commodity
www.mcxindia.com
www.ncdex.com
www.nmce.com

70

71