Commodities are traded daily where goods are bought and sold daily.
Then you have shares being traded in the Internet,Online.
Combine these both, you get Commodity trading Online,
This Commodity Trading is of two kinds.
One is where you buy on the spot for immediate delivery,’Spot Market‘
The other one is derivatives market, various financial instruments based on commodities are traded.
These financial instruments such as ‘futures’ are traded in exchanges,as the Share are traded.
To operate Commodity business you need a Demat Account(To know more about opening a Demat Account, read my post on Online Trading)
Options in goods are presently prohibited under Section 19 of the Forward Contracts (Regulation) Act, 1952.
No exchange or person can organize or enter into or make or perform options in goods.
There are no custody charges for holding the demat units.
You can take physical delivery of goods on surrendering demat units anytime you like.
The delivery locations and procedures related to physical delivery are specified in the respective product note.
How To Buy Commodities Online.
Register yourself as a client with any member of National Spot Exchange.
Open a demat account with any of the DPs empanelled with NSEL.
This can be done in any Bank where you hold your account.
You can then place your order for e-Series products by making a telephone call to your broker or directly through online trading terminals.
Orders once placed can not be modified but canceled.
On getting Registered with Sales Tax.
If you are not going to deliver the goods physically you need not have Sales tax Registration,
Profit margins differ as in normal Trading.
Beneficiary Account.
It takes at least 1 to 3 working days to complete all formalities of opening a beneficiary account.
Members of the Exchange can open a CM pool account with any of the DPs empanelled with NSEL. The Exchange issues a member ID intimation letter to the member, which has to be submitted along with the request for opening a CM Pool Account. Clients are required to submit their KYC documents for opening a beneficiary account.he charges are notified by the DPs to all the clients holding beneficiary account with them. The DPs normally charge Annual Maintenance Charges (AMC) and transaction charges on all debit instructions. It is similar to the practice followed in equity market.
“NSEL conducts spot trading in various agricultural and non-agricultural commodities, including gold and silver. The Exchange currently offers trading in 32 commodities. Contracts are designed and customised to fulfil the requirement of big corporates, traders and small farmers.
NSEL launched a new segment ‘e-Series’ in 2010, which is exclusively designed to develop a cash segment in commodities. e-Gold was the first product to be launched under e-Series, followed by e-Silver, e-Copper and e-Zinc. e-Series products track prices of physical commodities. These are commodity investment products in demat, available in small denominations to enable commodity investment, in the form of SIPs (Systematic Investment Planning), for retail and investors and portfolio diversification for HNIs.”
Source: For More Details,
To get Information and Tips on Commodity Trading visit Link,
http://www.commodityonline.com/advisory/
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