| What are commodities? |
| In its simplest meaning, commodities are things of value, of uniform quality, having long shelf life and that are produced and consumed in large quantities by many different producers and consumers. |
|
|
|
| What are commodity futures? |
| A commodity futures contract is a contract to buy or sell some fixed amount of a commodity (wheat or soy beans, for example) for a fixed price at a future date. |
|
|
|
| Why are only certain commodities included in commodity futures trading? |
| All commodities are not equally suitable for futures trading. |
|
|
|
| Difference between commodities and other asset classes |
| Commodities unlike stocks and bonds are physical assets that can be bought, sold and used for something. |
|
|
|
| Act Governing Commodities Market |
| Commodities are governed by the Forward Contracts (Regulation) Act, 1952 |
|
|
|
| How is it different from buying commodities in the spot market? |
| In spot market actual delivery of goods take place, whereas futures can be cash settled |
|
|
|
| Basic note on regulators |
| The Forward Markets Commission (FMC) is the regulator for the commodities futures market in India. |
|
|
|
| Why a sudden boom in commodities? |
| Expert’s opinion on the future of commodities market |
|
|
|
| Who should trade in commodities? |
| Market participants are... |
|
|
|
| What are the reasons for trading in commodities? |
| There are various reasons behind participation in commodities market. |
|
|
|
| Historical and current data |
| History of commodity market and commodity futures in India. |
|
|
|
| How much have the commodity exchanges in India grown? |
| According to the Ministry of Consumer Affairs, the total value of commodity futures trade was Rs 21.34 lakh crore in 2005-06, up 274 per cent from Rs 5.71 lakh crore in 2004-05. |
|
|
|
| The re-introduction of commodity futures in India |
| The Khusro Committee recommended re-introduction of futures trading in most of the major commodities including cotton, kapas, raw jute and jute goods. |
|
|
|
| The growth of commodity exchanges and the change in liquidity |
| The volume of trade has also gone up considerably by 244 per cent to 668.5 million tonnes in 2005-06, against 194.2 million tonnes in 2004-05. |
|
|
|
| What is the future of the commodities market and the issues likely to be faced? |
| Eye-popping daily trade volumes will be seen and the consensus is that the trade volume has a potential of 4 times the equity markets including equity F&O.; |
|
|
|