In India, we have three major commodity exchanges – The National Commodity and Derivative Exchange (NCDEX), The Multi Commodity Exchange of India (MCX) and The National Multi Commodity Exchange of India (NMCE). All three have electronic trading and settlement systems and a national presence. Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities. It includes Gold, Silver, Platinum Copper, Zinc, Lead, Nickel, Aluminum etc.
The prices and trading lots, in the bullion market – gold and silver are calculated for ten grams for gold, and one kilo grams for silver. In case of agricultural commodities, the prices vary from exchange to exchange (in kg, quintals or tonnes).
As in stocks, in commodities also the margin is calculated by (value at risk) VaR system. Normally it is between 5 per cent and 10 per cent of the contract value.
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