Matrix Mobile Trading for IOS Users
The application empowers you to be connected to the India’s leading broking house trading platform & it lets you create Watch Lists, Stock View, Place Order, Track Market Movement, Research Call and many more on a single click.
Trading on commodities online is almost similar to futures trading, but this is not something that one should pursue unless you do lots of homework. In online commodity trading, you don’t have to call your commodity broker to place orders on your behalf, so in that case it’s much more efficient than the traditional method. But before you decide to start your online commodity trading, there are some important factors that you need to keep in mind, and they are.
Well choosing a commodity broker is not a tough task now days. Because, if you are already utilizing the services of a broker to trade online in any other segments like equity-cash and equity-futures segment, then you can check with your existing broker whether they have the necessary membership from commodity exchanges like MCX and NCDEX. So, if they are having necessary membership then you can open there it, as it requires only less documentation.
Now, almost all commodity brokers offer online trading platform. You have to select the one who gives the best online trading platform with technical charts, live recommendations and analysis, support and hassle free order entry. You should also try to find out about their commodity research capabilities, support service and commission rates.
In order to open your commodity trading account, you need to furnish necessary KYC documents, which include disclosure of your financial information. Because, unlike equity, commodities are highly leveraged asset classes and there is a chance that you can lose more money than you initially invested. So, even if you fill all the details, it’s not sure that the broker will grant you an account to trade commodities online. Sufficient income, credit worthiness and trading experience are some critical elements of suitability.
So, once you opened your account with a broker and you received the approval for trading, the next step is to fund the account. It’s up to one’s comfort level, risk tolerance and return expectations. It’s always recommended that before you start trading with real fund, do attend certain training sessions conducted by exchanges or by the broker itself and familiarize with the different types of commodities available for trading, margin requirements for each item and the expected profit/loss that you will make if the price of the item you select to trade moves by a tick.
Always, remember that futures and options markets are derivatives of the actual market for the physical delivery of the commodity in question. It is important to read a lot and learn all you can about the underlying supply and demand fundamentals for each of the commodities that you are interested to trade. You get a large chunk of information free of cost from the commodity exchanges as well as from a variety of trade organizations, government agencies and even from the brokers own research desk.
We said above, you need to spend sufficient time to understand different commodities and their supply and demand fundamentals or fundamental analysis. One thing that you should always keep in mind is that, the futures trading in commodities are laden with risk. There exists tremendous opportunity to make huge gains, similar is the case for making loss. Of course you need to have a good-faith deposit or margin to trade in commodities futures.