A STUDY ON COMPARISION OF ONLINE WITH OFFLINE

TRADING IN COMMODITIES

ABSTRACT

This project titled “A study on comparison of online with offline

trading in commodities” describes about now the clients are select the
medium (online or offline) while involved in trading activity particularly in
commodity market and what are the factors determine that medium and what
are the things they expect from stock exchange.

It is important that people need to understand the dynamic and the

compulsion of the financial market. Whether it is share market or any other
financial market nowadays investors goes an the sentiments of the market
without actually studying in which investments is being market moreover
the some investor usually does not have eldgenate knowledge about the
trading types and those features.

Generally when correction factor occurs in the market most of the

funds will turn red and will not perform well. But there are few funds, which
are consistent ever when occurs these funds will yield return on the
investments made even when the market is improper.

1
 TABLE OF CONTENTS

CHAPTER CONTENTS PAGE NO

1 Introduction 1
1
Need and Scope of the study 2

Objectives 2

Industry Profile 3

Company Profile 6
Product Profile 16

Research Methodology 21

2. Data Analysis and Interpretation 36

3. Findings 50

4. Suggestions 51

5. Conclusion 52

References 53

2
 LIST OF TABLES

TABLE NO. CONTENTS PAGE NO

1. Table based on Age 35

2. Table based on Sex 36

3. Table based on Educational Qualification 37

4. Table based on Experience 38

5. Table based on Online Trading 39

6. Table based on Offline Trading 40

7. Table based on Commodity Trading 41

8. Table based on Intraday Trading 42

9. Table based on Delivery Day Commission 43

Table based on Credit Limit Provided by

10. 44
The Company

Table based on What they like mostly

11. 45
online or offline Trading

12. Table based on Online Commodity 46

13. Table based on Offline Commodity 47

Table based on Expectation of other

14. 48.
facilities

3
 LIST OF CHARTS

CHART NO. CONTENTS PAGE NO

1. Chart based on Age 35

2. Chart based on Sex 36

3. Chart based on Educational Qualification 37

4. Chart based on Experience 38

5. Chart based on Online Trading 39

6. Chart based on Offline Trading 40

7. Chart based on Commodity Trading 41

8. Chart based on Intraday Trading 42

9. Chart based on Delivery Day Commission 43

Chart based on Credit Limit Provided by

10. 44
The Company

Chart based on What they like mostly

11. 45
online or offline Trading

12. Chart based on Online Commodity 46

13. Chart based on Offline Commodity 47

Chart based on Expectation of other

14. 48.
facilities

4
 1. INTRODUCTION
Angel Broking has once again been awarded the prestigious ‘Major
Volume Driver’ award for the second consecutive year of 2005-2006 by
The Bombay Stock Exchange. This coveted title was earlier conferred upon
Angel by the BSE for the year 2004-2005. About the Group.

The Angel Group has emerged as one of the top 5 retail stock broking
houses in India, having memberships on BSE, NSE and the two leading
commodity exchanges in the country i.e. NCDEX and MCX. Angel Broking
Ltd is also registered as a depository participant with CDSL. It is the only
100% retail stock broking house offering a gamut of retail centric services
like Research, Investment Advisory, and Wealth Management Services, E-
Broking & Commodities to individual investor.

The group is promoted by Mr. Dinesh Thakkar and professionally

managed by a team of 1980+ direct employees. It has a nation wide network
comprising 12 Regional Centres , 66 branches, 2997+ registered sub brokers
and business associates and 6370+ active trading terminals which cater to
the requirements of 244736+ retail clients.

5
 NEED FOR THE STUDY
During my studies I knew something about the company, but now I
have specialized in a particular department for gaining industrial knowledge
about financial department for further continuation of my studies.

Because all departments will not give overall up to date knowledge

about industry, if we went for particular department overall functioning of
department will come to know. This company is one of the leading and
professionally managed stock broking firm involved in quality services and
research..

OBJECTIVE OF THE STUDY

1. To know about a particular department functioning in the
organization.

2. To understand about the different managerial styles used in various

kind of management.

3. To know about the workers comfort in the organization.

4. To understand about the difficulties of industry in the competitive

world.

5. To gather practical knowledge in financial department.

6
 INDUSTRY PROFILE

The financial market in India is one of the oldest in the world and is
considered to be the fastest growing and best among all the markets of the
emerging economies. The history of Indian capital markets dates back 200
years toward the end of the 18th century when India was under the rule of
the East India Company. The development of the capital market in India
concentrated around Mumbai where no less than 200 to 250 securities
brokers were active during the second half of the 19th century.

The financial market in India today is more developed than many

other sectors because it was organized long before with the securities
exchanges of Mumbai, Ahmedabad and Kolkata were established as early as
the 19th century. By the early 1960s the total number of securities exchanges
in India rose to eight, including Mumbai, Ahmedabad and Kolkata apart
from Madras, Kanpur, Delhi, Bangalore and Pune. Today there are 21
regional securities exchanges in India in addition to the centralized NSE
(National Stock Exchange) and OTCEI (Over the Counter Exchange of
India).

However the stock markets in India remained stagnant due to stringent

controls on the market economy that allowed only a handful of monopolies
to dominate their respective sectors. The corporate sector wasn’t allowed
into many industry segments, which were dominated by the state controlled
public sector resulting in stagnation of the economy right up to the early
1990s. Thereafter when the Indian economy began ‘liberalizing’ and the
controls began to be dismantled or eased out, the securities markets

7
witnessed a flurry of IPOs that were launched. This resulted in many new
companies across different industry segments to come up with newer
products and services.

A remarkable feature of the growth of the Indian economy in recent

years has been the role played by its securities markets in assisting and
fuelling that growth with money rose within the economy. This was in
marked contrast to the initial phase of growth in many of the fast growing
economies of East Asia that witnessed huge doses of FDI (Foreign Direct
Investment) spurring growth in their initial days of market decontrol. During
this phase in India much of the organized sector has been affected by high
growth as the financial markets played an all-inclusive role in sustaining
financial resource mobilization. Many PSUs (Public Sector Undertakings)
that decided to offload part of their equity were also helped by the well-
organized securities market in India.

The launch of the NSE (National Stock Exchange) and the OTCEI
(Over the Counter Exchange of India) during the mid 1990s by the
government of India was meant to usher in an easier and more transparent
form of trading in securities. The NSE was conceived as the market for
trading in the securities of companies from the large-scale sector and the
OTCEI for those from the small-scale sector. While the NSE has not just
done well to grow and evolve into the virtual ‘backbone’ of capital markets
in India the OTCEI struggled and is yet to show any sign of growth and
development. The integration of IT into the capital market infrastructure has
been particularly smooth in India due to the country’s world class IT
industry. This has pushed up the operational efficiency of the Indian stock

8
market to global standards and as a result the country has been able to
capitalize on its high growth and attract foreign capital like never before.

The regulating authority for capital markets in India is the SEBI

(Securities and Exchange Board of India). SEBI came into prominence in
the 1990s after the capital markets experienced some turbulence. It had to
take drastic measures to plug many loopholes that were exploited by certain
market forces to advance their vested interests. After this initial phase of
struggle SEBI has grown in strength as the regulator of India’s capital
markets and as one of the country’s most important institutions.

9
 COMPANY PROFILE
Name of the company : Angel Broking

Address of the company : Chennai regional office,

Gr.Floor ,45ttk road,

Alwarpet,

Chennai-600018

Phone Number : 044 42269000

Email address : feedback@angeltrade.com

Website : www.angeltrade.com

Name of directors : Mr. Dinesh Thakkar

Mr. Mukesh Gandhi

Angel Broking Limited is one of the leading and professionally

managed stock broking firm involved in quality services and research. Angel
Broking Limited is a corporate member of The Stock Exchange, Mumbai.

The membership of the company with The Stock Exchange Mumbai

was originally in the name of Mukesh R. Gandhi, which was eventually
turned into a corporate membership in the name of Angel Broking Limited.

Angel Broking Limited is managed by Mr. Dinesh Thakkar and he is

well supported by Mr. Mukesh Gandhi, a fifteen years veteran in the market.

10
 The group is well supported by a professional and qualified research
team and efficient operations and back office team, which comprises of
highly dedicated and qualified individuals. Angel has an in-house, state of
art research department.

Angel believes in reaching out to the customer at the farthest end

rather than by reaching out to them. The company in its endeavour to give its
client the best has opened up several branches all over Mumbai, which are
efficiently integrated with the Head Office.

Angel Broking Limited is primarily into retail stock broking, with a

customer base of retail investors, which has been increasing at a
compounded growth rate of 100% every year. The company has huge
network sub-brokers in Mumbai and other places outside Mumbai,
registered with SEBI, who act as chanel partners for the company. The
company presently has a total staff strength of around 150 employees who
are spread accordingly across the head office and all the branches.

Angel has empowered its physical presence throughout India through

various strategies which it has been adopting efficiently and effectively over
a period of time, like opening up of branches at various places, tie-ups with
various agencies and sales agents, buy-outs of smaller regional outfits and
appointment of sub-brokers and franchisees

Our Vision

11
 To Provide

Best Value For Money

To Investors Through

Innovative Products,

Trading / Investment Strategies,

State-of-the-art Technology

And Personalized Service.

Our Business Philosophy

Ethical practices & transparency in all our dealings

Customer interest above our own

Always deliver what we promise

Effective cost management

Our Quality Assurance Policy

We are committed to being the leader

In providing World Class Product & Services

12
 Which exceed the expectations of our customers

Achieved by teamwork and

A process of continuous improvement

Our CRM Policy

A Customer is the most Important Visitor

On Our Premises

He is not Dependent on us but

We are dependant on him

He is not interruption in our work,

But is the Purpose of it

We are not doing him a favor by serving

He is doing us a favor by giving us an

Opportunity to do so

Angel Broking Ltd.- BSE-612, INB010996539, UIN 100002972

Angel Capital & Debt Market Ltd. - NSE-12798, Cash - INB231279838,
F&O - INF231279838 UIN 100002964
Angel Commodities Broking Pvt. Ltd.- MCX-12685,
MCX/TCM/CORP/0037 | NCDEX-00220, NCDEX/TCM/CORP/0302, UIN
10059063

13
Angel Securities Ltd. - Cash INB010994639, F&O INF010994639, UIN
100002956

E-BROKING

Welcome to the World of E-Broking

Multiple exchanges on a single screen
Intra-day calls and flash news
Historical charts with technical tools
Streaming quotes
24x7 web enabled back – office
Auto pay-in of shares
Online transfer of funds
Our e-broking facility is one such effort, which gives you access to state-
of-the-art trading platform with multiple exchanges, order and trade
confirmations, research reports, e-contracts and a 24x7 on-line web
enabled centralized back-office system at the click of a button.

E-BROKING:

 Multiple exchanges on single screen

 Intra-day calls & flash news

 Historical charts with technical tools

RESEARCH:

 Daily services

14
  Technical services

 Fundamental services.

INVESTMENT ADVISORY SERVICES:

Angel offers personalized advisory services to HNI investors and

actively assists them in managing their portfolio...

COMMODITIES:

 State-of-the-art internet trading platform

 Trading & educational seminar

 Efficient risk management

DEMAT SERVICES:

 Hassle free automated pay-in

 Wide branch coverage

 Centralized billing & accounting

VALUE ADDED BACK OFFICE SERVICES:

 Web enabled centralized back-office

 Centralized help desk services

 E-contract notes cum bills.

About Angel Group

15
 Angel group is engaged in various activities such as trading / advisory
services in Indian capital markets viz., equity, futures and options etc. and
also in Indian commodities markets viz., commodities futures.

About Angel Commodities

ANGEL COMMODITIES BROKING (P) LIMITED promoted by
ANGEL GROUP, started its operations in Indian commodities market by
acquiring memberships in India's premier multi-commodity exchanges of
NCDEX (Membership No:00220) and MCX (Membership No: 12685).

ANGEL COMMODITIES offers trading opportunities in commodity

markets through the chain of its branches spread across the country.

ANGEL COMMODITIES provides expert research / analysis to its

clients in various commodities, listed in NCDEX and MCX including the
international perspective of the commodities traded. It provides best
technical analysis from desk of its trained and qualified analysts.

The research team of angel commodities consists of professionals who

are industry veterans. The team is capable of formulating trading strategies
depending on risk-return profile of the client. Today we offer a gamut of
financial products to satisfy an array of financial needs.

Why trade with Angel Commodities?

We have the following application and services to provide you best
trading opportunities available in the industry.

16
 • Online application based trading software

• Online web based trading platform

• Online daily, weekly and monthly research

• Transparent and fair trade execution

• Individual client attention

• 24*7 online back office

• Training/education facilities / conduct of seminars

• State-of-the-art technology

• Digital contract notes cum bill: View your accounts from any where,
any time

• Efficient risk management

• Competitive brokerage rates

Salient features of angel trade :

• Multiple exchanges on a single screen: Online trading on BSE /
NSE (Cash and F&O), MCX and NCDEX on a single screen.

• Speed: We use the latest technology to generate efficient uptime

and greater stability to give you high speed.

• Competitive brokerage rates: We believe in providing our

clients the best value added services at the most competitive
brokerage rates.

• Optimum margins: Angel gives you the trading exposure at

17
 optimum margin level

• Online funds transfer: The clients enjoy the convenience of

online transfer of funds from their bank accounts, to the margin
account of Angel, online.

• Personalized service: HNI clients can avail of personalized

advisory services from our trained and experienced dealers,
regarding trading opportunities.

• Off line services: You are free to make a telephone call to any of
our 71 well equipped branches across the country.

• Technology: Angel provides the latest infrastructure tools to

support and integrate the backend and front office functionalities.

• Back office infrastructure: We provide an automated web

enabled centralized back-office whereby the clients can have
access to their trade confirmation reports, holding statement, their
net position, the margins and the statement of accounts and
ledgers on a 24 X 7 basis.

• Technical support: We remove technical difficulties through an

online support system managed by qualified professionals.

• E - Contract notes cum bills: We provide contract notes cum

bills in electronic form resulting in ease of access to trades carried
out by the clients on any particular day.

18
 PRODUCT PROFILE
Commodity market

Commodities are more than what you think they are. Almost
everything you see around is made of what market considers commodity. A
commodity could be an article, a product or material that is bought and sold.
It could be any kind of movable property, except actionable claims, money
and securities. Commodity trade forms the backbone of world economy.

The Indian commodity market is estimated to be around Rs. 11

million, and forms almost 50 percent of the Indian GDP. This market
constitutes Agri and Non Agricultural Products. Agricultural commodities
are those like rice, wheat, groundnut, tea, coffee, jute, rubber, spices and
cotton,Vegetable Oils etc.,while Non Agricultural Commodities can be
classified as Precious metals such gold and silver, base metals like iron and
aluminum,tin,nickel etc., and energy commodities such as crude oil and
coal.
So what do the commodity brokers actually do? They simply facilitate the
business of buyers and sellers, for a legalized rate of commission.

SEEDS

• Castor Seed

• Copra

• Cotton Seed

• Cumin Seed (Jeera)

19
 • Groundnut

• Linseed

• Rape/Mustard Seed

• Rape Seed-42

• Safflower

• Sesame Seed

• Soybean

• Sunflower seed

• Yellow Soybean Meal

OILS

• Castor Oil

• Coconut Oil

• Cotton Seed Oil

• Groundnut Oil

• Linseed Oil

• Rape/Mustard Seed Oil

• Safflower seed Oil

• Sesame seed Oil

• Soybean Oil

• Sunflower seed Oil

• Crude Palm Oil

20
 • RBD Palmolein

• Rice bran Oil

• Vanaspati

OIL CAKES

• Castor Oilcake

• 7Coconut Oilcake

• Cotton Seed Oilcake

• Groundnut Oilcake

• Linseed Oilcake

• Rape/Mustard Seed Oilcake

• Safflower seed Oilcake

• Sesame Oilcake

• Soybean Oilcake

• Sunflower seed Oilcake

21
METALS

• Aluminum

• Copper

• Gold (100 Gms)

• Kilo Gold

• Lead

• Nickel

• Silver

• Steel Flat

• Steel Long

• Tin

• Zinc

SPICES

• Pepper

• Cardamom

• Turmeric

• Red Chilli

PULSES

• Gram

• Tur/Arhar

• Urad

22
 • Moong

• Masoor

• Yellow Peas

OTHERS

• Rubber

• Sacking

• Sugar

• Gur

• Guarseed

• Guarseed Bandani

• Wheat

• Rice

• Raw Jute

• Kapas

• Medium Staple Cotton

• Long Staple Cotton

• Cashew Kernel

• Maize

23
 RESEARCH METHODOLOGY
Research

Research refers to a critical, careful and exhaustive investigation or

inquiry or experimentation having has its aim the revision of accepted
conclusions, in the light of newly discovered facts.

Redman and mory has explained research as “systematizied effort to

gain knowledge”

Research methodology

Research methodology is a way to systematically solve the

research problem. It is necessary to know the methodology of the research.
The present study depends upon primary and secondary data collected from
public in Salem city.

Population

Population refers to the total of items about which information is

desired. The population of universe can be finite or infinite. The population
is said to be finite if it consist of a fixed number of elements so that it is
possible to enumerate it in it totality. An infinite population is that
population in which it is theoretically impossible to observe all the elements.
We can’t have any idea about the total.

Sample size

From the portion of total population I have selected 100 respontent for
doing the research.

24
Collection of time

There are two processes in collecting data. They are primary and
secondary data, which I have used for collecting the data, is both primary
and secondary data.

Primary data

In primary data the interview schedule is used to collect the information

from the employees in the organization

Secondary data

Secondary data is used to collect information from the internet and

also from the past records.

Data analysis

The collected data from the respondents was analyzed with the help of
simple percentage method.

What is commodity?

Commodity markets are those markets where raw or primary products are
exchanged. These raw commodities are traded on regulated commodities
exchanges in which they are bought and sold in standardized Contracts. This
is called commodity trading.

For a commodity market to be established there must be broad consensus

on the variations in the product that make it acceptable for one purpose or
another.

Generally, Governments must provide a common regulatory or

insurance standard and some release of liability, or at least a backing of the

25
insurers, before a commodity market can begin trading.

Unless the product or service can be guaranteed or insured to be free

of liability based on where it came from and how it got to market it becomes
impossible for sellers to guarantee a uniform delivery.

Indian commodities exchange

Commodity trading is increasingly becoming a prominent business in

India. To facilitate this trading there are various exchanges setup in India.
These exchanges are the hub of the trading of various commodities.

The primary Indian commodity exchange is the Multi Commodity

Exchange of India (MCX). The other very prominent commodity exchange
is National Commodities and Derivatives Exchange Limited.

NCDEX is located in Mumbai and offers facilities in more than 550

centers in India.

MCX features amongst the world's top three bullion exchanges and
top four energy exchanges.

MCX is the only Exchange in India to have such investment and

technical support from the commodity relevant institutions.

The day-to-day operations of the Exchange are managed by the

experienced and qualified professionals with impeccable integrity and
expertise.

26
MCX INDIA

Organized commodity trading is one of the latest money earning vehicles

in India. MCX (ISO 9001:2000) is an independent and de-mutualised multi
commodity exchange.

Inaugurated on November 10, 2003, MCX has permanent recognition

from the Government of India for facilitating online trading, clearing and
settlement operations for commodity futures markets across the country.

Today, MCX features amongst the world's top three bullion

exchanges and top four energy exchanges.

The average daily turnover of MCX is approximately USD 1.52

billion (INR 7, 000 Crore for the Apr – Jun 2006 quarter) with a record peak
daily turnover of USD 3.98 billion (INR 17,987 Crore) on April 20,2006.
In the second calendar quarter of 2006, MCX holds more than 55% market
share of the total trading volume of all the domestic commodity exchanges.
The exchange has also affected large deliveries in domestic commodities,
signifying the efficiency of price discovery.

NCDEX INDIA

India is fast progressing in the area of commodity and derivatives trading

under the aegis of the National Commodity and Derivatives Exchange
Limited.

NCDEX is a closely held private limited company incorporated on

April23, 2003, under the Companies Act 1956.It obtained its Certificate for
Commencement of Business on May9, 2003. It has commenced its

27
operations on December15, 2003.

NCDEX has an independent Board of Directors and professionals not

having vested interest in commodity markets. NCDEX is regulated by
Forward Market Commission (FMC) in respect of futures trading in
commodities.

Besides, NCDEX is subjected to various laws of the land like the

Companies Act, Stamp Act, Contracts Act, Forward Commission
(Regulation) Act and various other legislations, which impinge on its
working.
On February3rd, 2006, the FMC found NCDEX guilty of violating
settlement price norms and ordered the exchange to fire one of their
executive. NCDEX is located in Mumbai and offers facilities in more than
550 centers in India.

Commodity option trading system

The commodity options trading system basically consists of a market in

which producers may purchase the opportunity to sell or buy a commodity at
a certain price. This is similar to a situation where a farmer may purchase the
right from an insurance firm to collect on a policy in case his buildings burn,
he can purchase the right to sell his commodities at a specific price if market
prices go below the specified price.

In fact a separate market exists where purchase of the right to buy

commodities at a specified price of market prices are higher than the
specified price. Therefore, effectively there are really two separate
commodity options trading systems - one where it is possible to insure
products being sold against price declines, and another where it is possible

28
to insure products purchased against price increases.

People who participate in the commodity options trading systems have

the opportunity but not the obligation to exercise their agreement. This is the
reason that the system is appropriately named the option trading system
since they deal in an option, not an obligation.

To explain this concept further, for instance, if a person desires to buy the
right to sell a given commodity for a certain price, the commodity options
market provides the opportunity. By paying the market-determined
premium, the person could then collect on the option if prices are below the
price at which the deal was finalized when the corn would actually be sold.
If prices are higher than the price at which the deal was finalized, the
commodity could be sold for the higher price and the cost of the premium is
absorbed.

As mentioned, there are actually two basic types of commodity option

trading systems: a call option and a put option. The call option gives the
holder the right, but not the obligation, to buy the underlying commodity
from the option writer at a specified price on or before the option's
expiration date.

On the other hand, the put option gives the holder the right, but not the
obligation, to sell the underlying commodity to the option writer at a
specified price on or before the option's expiration date. The call option and
the put option are two distinct contracts.

29
Commodity futures trading commission

The mission of the Commodity Futures Trading Commission is

primarily to protect the market users and the public from malpractices such
as fraud, manipulation, and abusive practices related to the sale of
commodity and financial futures and options, and to foster open,
competitive, and financially sound futures and option markets.

The Congress created the Commodity Futures Trading Commission in

1974 as an independent agency with the mandate to regulate commodity
futures and option markets in the United States. The basic mandate taken up
by the agency was to renew and expand since then.

Today, the Commodity Futures Trading Commission regulates the

economic utility of the futures markets by encouraging their competitiveness
and efficiency, ensuring their integrity, protecting market participants
against manipulation, abusive trading practices, and fraud, and ensuring the
financial integrity of the clearing process.

It is through effective oversight, that the Commodity Futures Trading

Commission enables the futures markets to serve the important function of
providing a means for price discovery and offsetting price risk.
The CFTC monitors markets and market participants closely by
maintaining, in addition to its headquarters office in Washington, offices in
cities that have futures exchanges-New York, Chicago, Kansas City, and
Minneapolis.
Benchmarked against the functions and responsibilities assumed by
the Commodity Futures Trading Commission in the United States, The
Forward Markets Commission (FMC) was set up as the regulatory body for

30
Commodity Trading in futures/forward trade in India. Similar to the function
of the CFTC, The Forward Markets Commission is responsible for
regulating and promoting futures trade in commodities in India.

The FMC has its headquarters in Mumbai and the regional office is
located in Kolkata.

There are some 21 commodity exchanges in India. But most of these

commodity exchanges are regional, offline and commodity specific. The
government has recently allowed four national level multi-commodity
exchanges to trade in all permitted commodities

Commodity trading advisors

Commodity Trading Advisors usually use proprietary trading programs

that buy and sell commodities and financial futures around the globe and
specifically in India to seize profit opportunities in a variety of markets. The
set of Commodity Trading Advisors in India are an increasingly popular and
potentially profitable investment alternative for institutional investors and
high-net-worth individuals and are an emerging option especially in India.

The Chartered Alternative Investment Analyst SM programme is the

industry's global professional standard that covers commodities and
managed futures since its inception. The hedge funds have so far captured
most of the media and publishers' attention and little has been done to
provide investors with a comprehensive review of the fast growing
Commodity Trading Advisors.

The Commodity Trading Advisors usually investigate the many benefits

and risks examining the risk/return characteristics of a number of different

31
strategies. There are many issues related to Commodity Trading Advisors
investment, fees and regulations.

Much of the information relating to Trading Advisors can be technical in

nature.
When they look for portfolio diversification, they investigate futures
programs.
Unlike other asset classes, where profits depend solely on price
appreciation, opportunities in futures exist in both rising and falling markets,
in areas all around the world in at least 50 different futures markets.
You need to find a Commodity Trading Advisors program that suits your
financial objectives and risk parameters. It would be necessary to monitor
many managed programs, and have good working relationships with the
commodity trading advisors whose programs are top performers.

Online commodity trading

Online commodity trading offers a way for an open, many-to-many

system, where every user has equal access to price quotes and trading
functionality.

It provides a level playing field for all, without favoritism or control by a

chosen few, where any user can view all quotes posted by other users in real
time, act or trade on quotes posted by others, post their own prices and
quantities for others to trade.

The Online commodity trading site usually lists a large number of unique
products covering a variety of commodities, structures, and settlement terms
ranging from Oil, Natural Gas, Electric Power, Precious Metals, Emissions
and Weather.

32
 It provides for various media ranging from Physical Delivery and
Financial Cash Settlement. There are further derivative options available
ranging from Forwards, Swaps, Options, Spreads, Differentials, Complex
Derivatives.

Liquidity, or trade activity, is perhaps the best measure of success of an

online trading commodity trading system. With most online commodity
trading systems, traders can be sure of finding an interesting market
development or trading opportunity almost every time they log on.

All quotes posted by users on any online commodity trading systems are
live and firm. They can be acted on with full assurance of a completed
transaction. The greatest advantage of an online system for trading is that
just a click can be used to hit a bid or lift an offer.

The Online trading system operates almost continuously around the

clock, 24 hours a day, seven days a week. This allows any user to extend the
trading day, and easily pass the trading objectives to others in companies in
different time’s zones.

The online commodity trading system in India is only an emerging

segment yet. This is because the Internet boom in Indian is on the rise only
now. The Internet charges are becoming minimal and the Internet is soon
becoming a way of life in India. It is in this scenario that online trading is
becoming more the way of trading in India.

33
OFFLINE COMMODITY

Commodities are more than what you think they are. Almost
everything you see around is made of what market considers commodity. A
commodity could be an article, a product or material that is bought and sold.
It could be any kind of movable property, except actionable claims, money
and securities. Commodity trade forms the backbone of world economy.

Offline commodity trading means apart from online commodity

trading, goods or things involved in buying and selling activity, those are all
the activities considered as offline commodity trading. For example retail
marketing, vegetable markets, jewel shops and so on.

Now a days banking sectors also involved in offline commodity trading.

They involved selling and buying gold from customers.

A guide for Indian Entrepreneurs to understand the business of

commodity trading

The concept of Commodity Trading is not new in India. Commodity

Trading was very much existent in earlier times in India. In fact it was one
the most vibrant forms of markets till the early 70s.

However due to numerous restrictions the Commodity Trading market

could not develop further. Recently most of these restrictions have been
removed, and therefore this allows for the development and growth of the
commodity market in India.

The usefulness of Commodity Trading in futures is that it results in

transparent and fair price discovery on account of large-scale participations

34
of entities associated with different value chains. It also reflects views and
expectations of a wider section of people who may be related to a particular
commodity.

Commodity Trading in futures also provides an effective platform for

price risk management to all the segments of players who participate in the
Commodity Trading ranging from producers, traders and processors to
Exporters/importers and end-users of a commodity.

Commodity Trading also provides hedging, trading and arbitrage

opportunities to market players.

The Forward Markets Commission (FMC) is the regulatory body for

Commodity Trading in futures/forward trade in India.

The Forward Markets Commission is responsible for regulating and

promoting futures trade in commodities.

The FMC has its headquarters in Mumbai and the regional office is
located in Kolkata.

There are some 21 commodity exchanges in India. But most of these

commodity exchanges are regional, offline and commodity specific.

Difference between online and offline stock trading?

The introduction of the Internet has surprisingly changed our way of

life as a society. It has defined the way we do business and the way we
correspond. The Internet has opened many opportunities for online trading.

35
 The financial industry revolves around the Internet. Every thing is just
a few clicks away. This makes online trading most convenient. But there are
still investors who prefer the old fashion way of offline trading and they
mainly prefer offline trading for security reasons.

Internet has introduced a way for consumers to manage their money

online. Not to mention, Internet has transformed the way investment
companies operate their business and has made it easy for private investors
to gain straight access to a range of different markets and online tools that
were at one point only reserved by the use of investment professionals.

Consumer investing and online trading has dramatically changed over

the last decade. Online trading dynamically continues to be redefined.
Services have expanded to include integrated management of additional
financial accounts. Not to mention, it has subsequently expanded in
conjunction with ground-breaking improvements to the traditional trading
interface, such as telephone interface systems.

Of course, online trading has many advantages. There are several

wonderful reasons to invest online and consider online trading.
1. Money saving opportunities

The amount of money you save depends primarily on the online

brokerage firm that you choose. No two firms are the same. There may be
different regulations, similar to bank regulations. There are minimum
deposits required that must be maintained. As mentioned above, this will
depend on the online brokerage firm.

36
2. Instant online access

You can gain instant access to your account, the value of your portfolio
updates immediately before your eyes.
3. Enter online trades at anytime

You can enter online trades at anytime and from anywhere. This is
very convenient if you live in a different time zone than the country you are
trading in. Not to mention, it is especially fit for investors with busy
schedules.
4. With online trading you are in charge

You are in control of your investments. No sales pitches and no

hassle. You decide where to invest your money.

Nevertheless, with all the convenience of online trading there are still
investors who prefer the old fashion way of offline trading.

 Offline trading has lost some popularity but it is still the

main form of investing. Offline trading offers many benefits as well.
1. The one benefit that an investor appreciates the most is that
they are not alone when making investment decisions.

2. There are experienced and professional brokerage companies

that handle their investments for them.

3. Investors are not faced with the challenge of making these vital
investment decisions; especially, if they do not have the
experience necessary to make the appropriate
investments.

37
 4. Also, there is someone there to answer any questions that may
cause concerns.

Not to mention, with offline trading mistakes are less likely to take
place. No one wants to throw their money away or stand by and watch
someone else throw their money away. It may be wise to hire a professional
to assist you in making the correct investment decisions if you feel you lack
the knowledge necessary.

38
 2. DATA ANALYSIS AND INTERPRETATION
TABLE – 1

CLASSIFICATION OF THE RESPONDENTS BASED ON AGE

Age No. Of Respondents Percentage

Below 20 6 6
21 - 30years 34 34
31 - 40years 22 22
Above 40years 38 38
Total 100 100
INFERENCE:

The above table shows that 6% of the respondents are below 20yerars.
34% of the respondents are between the age group of 21-30years. 22% of the
respondents are between the age group of 31-40years and 38% of the
respondents are above 40years.

Chart - 1
Classification of the Respondents based on Age

40 38
34
35
30
25 22
20
15
10 6
5
0
Below 20 21 - 30years 31 - 40years Above 40years

39Age
 TABLE - 2

CLASSSIFICATION OF THE RESPONDENTS BASED ON SEX

Sex No. Of Respondents Percentage

Male 89 89

Female 11 11

Total 100 100

INFERENCE:

The above table shows that 89% of the respondents are males and
11% of the respondents are female.

Most of the respondents (89%) are males.

CHART-2

90
80
70
60 No. Of Respondents
50
40 Percentage
30
20
10 No. Of
0 Respondents
Male Female

40
 TABLE – 3

CLASSIFICATION OF THE RESPONDENTS BASED ON

EDUCATIONAL QUALIFICATION

Educational status No. Of Respondents Percentage

School level 56 56

ITI 20 20

Degree 24 24

Diploma 0 0

Total 100 100

INFERENCE:

The above table shows that 56% of the respondents having school
level of education and 24% of the respondent finished their Degree courses.

CHART-3

No. Of Respondents based on educational qualification

School level
ITI
Degree
Diploma

41
 TABLE – 4

CLASSIFICAATION OF THE RESPONDENTS BASED ON

EXPERIENCE

Experience in years No. Of Respondents Percentage

Below 1year 42 42

1 - 5year 29 29

6 -10year 9 9

Above 10year 20 20

Total 100 100

INFERENCE:

The above table shows that 42% of the respondents are having below
one-year experience. 29% of the respondents are having 1-5years of
experience. 9% of the respondents are having 6-10years experiences and
20%of the respondents having experience above 10years.

CHART-4

50
40
30
No. Of Respondents
20
Percentage
10
No. Of
0 Respondents
Below 1- 6- Above
1year 5year 10year 10year

42
 TABLE – 5

CLASSIFICATION OF THE RESPONDENTS BASED ON ONLINE

TRADING

Online Trading No. Of Respondents Percentage

Fully Satisfied 73 73

Satisfied 27 27

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 73% of the respondents are fully satisfied
with the online trading provided by the organization and 27% of the
respondents are satisfied with the online trading provided by the
organization.

CHART-5

Percentage
Fully Satisfied
Satisfied
Not Satisfied
No. Of
Respondents

0 20 40 60 80 100

43
 TABLE – 6

CLASSIFICATION OF THE RESPONDENTS BASED ON OFFLINE

TRADING

Offline Trading No. Of Respondents Percentage

Fully Satisfied 34 34

Satisfied 66 66

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 34% of the respondents are fully
satisfied with the ventilation facility provided by the organization and 66%
of the respondents are satisfied with the ventilation facility provided by the
organization.

CHART-6

Fully Satisfied
Satisfied
Not Satisfied

44
 TABLE-7

CLASSIFICATION OF THE RESPONDENTS BASED ON

COMMODITY TRADING

Commodity Trading No. Of Respondents Percentage

Fully Satisfied 38 38

Satisfied 62 62

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 38% of the respondents are fully satisfied
with the Commodity Trading and 62% of the respondents are satisfied with
the floor cleaning.

CHART-7

RESPONDENTS BASED ON COMMODITY TRADING

Not Satisfied

Satisfied No. Of Respondents

Percentage

Fully
Satisfied

0 50 100 150

45
 TABLE – 8

CLASSIFICATION OF THE RESPONDENTS BASED ON

INTRADAY COMMISSION

Intra Day Commission No. Of Respondents Percentage

Fully Satisfied 81 81

Satisfied 19 19

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 81% of the respondents are fully satisfied
with the Intra day commission charged by the organization and 19% of the
respondents are satisfied Intra day commission charged with the by the
organization.

CHART-8

100%
90%
80%
70%
60%
Percentage
50%
No. Of Respondents
40%
30%
20%
10%
0%
Fully Satisfied Satisfied Not Satisfied

46
 TABLE – 9

CLASSIFICATION OF THE RESPONDENTS BASED ON

DELIVERY DAY COMMISSION

Delivery Day Com mission No. Of Respondents Percentage

Fully Satisfied 25 25

Satisfied 63 63

Not Satisfied 12 12

Total 100 100

INFERENCE:

The above table shows that 25% of the respondents are fully satisfied
with the Delivery day commission. 63% of the respondents are satisfied with
the Delivery day commission and 12% of the respondents are not satisfied
with the Delivery day commission.

chart - 9

70 63
60
50
Percentage

40
30 25

20 12
10
0
Fully Satisfied Satisfied Not Satisfied
DELIVERY DAY COMMISSION

47
 TABLE – 10
CLASSIFICATION OF THE RESPONDENTS BASED ON CREDIT
LIMIT PROVIDED BY THE COMPANY
Credit Limit No. Of Respondents Percentage
Fully Satisfied 73 73
Satisfied 27 27
Not Satisfied 0 0
Total 100 100
INFERENCE:

The above table shows that 73% of the respondents are fully satisfied
with the Services provided by the broking company and 27% of the
respondents are satisfied with the Services provided by the broking
company. CHART-10

CLASSIFICATION OF THE RESPONDENTS

BASED ON CREDIT LIMIT

Not Satisfied

No. Of Respondents
Satisfied
Percentage

Fully Satisfied

0% 20% 40% 60% 80% 100%

48
 TABLE - 11

CLASSIFICATION OF THE RESPONDENTS BASED ON WHAT

THEY LIKE MOST WHETHER ONLINE OR OFFLINE TRADING

Most Like No. Of Respondents Percentage

Online Trading 76 76

Offline Trading 24 24

Not Interested 0 0

Total 100 100

INFERENCE:

The above table shows that 76% of the respondents are fully
interested to do the online trading. 24% of the respondents are interested in
offline trading.

CHART-11

online trading

No. Of Respondents
Percentage

49
 TABLE - 12

CLASSIFICATION OF THE RESPONDENTS BASED ON ONLINE

COMMODITY

Online Commodity No. Of Respondents Percentage

Fully Satisfied 64 64

Satisfied 36 36

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 64% of the respondents are fully satisfied
with the online commodity and 36% of the respondents are satisfied with the
online commodity.

CHART-12

100%
90%
80%
70%
60%
50% Percentage
40% No. Of Respondents

30%
20%
10%
0%
Fully Satisfied Not Satisfied
Satisfied

50
 TABLE - 13

CLASSIFICATION OF THE RESPONDENTS BASED ON OFFLINE

COMMODITY

Offline Commodity No. Of Respondents Percentage

Fully Satisfied 24 24

Satisfied 76 76

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 24% of the respondents are fully satisfied
with the offline commodity and 76% of the respondents are satisfied with
the offline commodity.

CHART-13

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Fully Satisfied Satisfied Not Satisfied

Percentage 24 76 0
No. Of Respondents 24 76 0

51
 TABLE-14

CLASSIFICATION OF THE RESPONDENTS BASED ON EXPECTATIONS OF

OTHER FACILITTIES.

Expectation Of Other Facilities No. Of Respondents Percentage

Fully Satisfied 17 17

Satisfied 83 83

Not Satisfied 0 0

Total 100 100

INFERENCE:

The above table shows that 17% of the respondents are expecting
some other facilities from management and 83%of the respondents are not
expecting any other facilities.

CHART 14

CLASSIFICATION OF THE RESPONDENTS BASED ON

EXPECTATIONS AND OTHER FACILITIES

100
80
60
40
No. Of Respondents
20 Percentage
Percentage
0
No. Of Respondents
Fully
Satisfied
Satisfied Not
Satisfied

52
 FINDINGS OF THE STUDY

84% of the respondents are males.

73% of the respondents are highly satisfied with online trading.

65% of the respondents are not satisfied with offline trading.

71 of the respondent are satisfied with in trading day commission.

30% of the respondent is highly satisfied regarding credit limit

allowed by the company.

27% of the respondents are highly satisfied with risk and return.

53
 SUGGESTIONS

Even though, online trading is better than offline trading. Still it is

difficult for the traders to trade.

Many of our farmers tack in educational, therefore tack of knowledge

of market and exchanges. So there is a need to educate them in order to
participating in these markets to take the advantages of hedging again their
agricultural products.

Online trading do away from the more of intermediaries which is

farmer and must benefit to farmers.

Many company’s yet in to retail trading in big way. Volume of trading

is yet to be positive and which would pay way to better price discovery
mechanisms.

Online trading links farmers to consumers therefore resultors in better

realizations .

Offline line trading exeses customers to risk of credit defaults delay in

payments, and also delay of commodity dermises.

54
 CONCLUSION

TO my understanding the best of my knowledge with the help of my

study at “ANGEL BROKING”, there by conclude my study saying that
online trading is better in many terms than offline trading and will flourish
in the future.

55
 REFERENCE

www.commodity trading.com.

www.nseindia.comm.

www.money control.com.

56