Trading in commodity futures increases the options for market traders. Commodity trades are highly leveraged. The margin requirement for trading in commodity futures is quite low in comparison to the total holding.
As a result, trading in commodities is becoming one of the preferred options for day traders (especially futures of precious metals - gold and silver). Contracts of precious metals and crude are highly liquid and trades in them are quite volatile in nature.
Trading in commodities is on the rise since it was introduced in India in 2003. Today, traders can trade in future contracts of more than 50 commodities.
Precious metals (gold and silver)
Precious metals are used by traders the world over for hedging. There is plenty of scope for further gains in gold and silver prices due to weakness in the dollar, worries over the US and global economy, the ongoing credit crunch and the shaky geopolitical environment. Also, the demand for jewelry has gone up.
Crude oil
Crude oil prices are expected to remain firm in the medium term. The world's oil demand is expected to grow faster than the supply in 2008 as per the forecast from OPEC.
As a result, trading in commodities is becoming one of the preferred options for day traders (especially futures of precious metals - gold and silver). Contracts of precious metals and crude are highly liquid and trades in them are quite volatile in nature.
Trading in commodities is on the rise since it was introduced in India in 2003. Today, traders can trade in future contracts of more than 50 commodities.
Precious metals (gold and silver)
Precious metals are used by traders the world over for hedging. There is plenty of scope for further gains in gold and silver prices due to weakness in the dollar, worries over the US and global economy, the ongoing credit crunch and the shaky geopolitical environment. Also, the demand for jewelry has gone up.
Crude oil
Crude oil prices are expected to remain firm in the medium term. The world's oil demand is expected to grow faster than the supply in 2008 as per the forecast from OPEC.
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