» COMMODITY

  » A commodity may be defined as an article, a product or material that is bought and sold. It can be classified as every kind of movable property, except Actionable Claims, Money & Securities.

Commodities actually offer immense potential to become a separate asset class for market-  savvy investors, arbitrageurs and speculators. Retail investors, who claim to   understand the equity markets, may find commodities an unfathomable market. But    commodities are easy to understand as far as fundamentals of demand and supply are   concerned. Retail investors should understand the risks and advantages of trading in   commodities futures before taking a leap. Historically, pricing in commodities futures has   been less volatile compared with equity and bonds, thus providing an efficient portfolio diversification option.

In fact, the size of the commodities markets in India is also quite significant. Of the country's GDP of Rs.13, 20,730 crores (Rs.13,207.3 billion), commodities related (and   dependent) industries constitute about 58 per cent.

Currently, the various commodities across the country clock an annual turnover of Rs.1,   40,000 crore (Rs.1, 400 billion). With the introduction of futures trading, the size of the commodities market grows many folds here on.

  » Different types of commodities traded

World-over one will find that a market exits for almost all the commodities known to us.   These commodities can be broadly classified into the following:

  
     » Precious Metals: Gold, Silver, Platinum etc 
     » Other Metals:Nickel, Aluminum, Copper etc
     » Agro-Based Commodities:Wheat, Corn, Cotton, Oils, Oilseeds. 
     » Soft Commodities: Coffee, Cocoa, Sugar etc
     » Live-Stock: Live Cattle, Pork Bellies etc
     » Energy: Crude Oil, Natural Gas, Gasoline etc