- When it comes to commodity trading in India, finding the right broker is of importance. Having a list of shortlisted brokers makes it easy to finalize on one broker. There are reviews available online of brokers, which can help you to choose potential brokers.
- Always choose a broker who has the relevant years of experience of trading in the commodity market.
- A broker with a good net worth indicates how skilled he/she is in trading.
- Check the brokerage fees. Brokers who charge discounts, lower fees are preferable. Some brokers offer discounts only if there is a certain trading volume involved.
- If you are planning for intraday trading, then you need to have proper communication with the broker for the whole day. So you need to check if the brokerage company has a good customer support system.
- The broker should also help you with some trading tips and other research material regarding commodity trading.
- Brokers also help you with setting up your online commodity trading account. They then provide you with trading platforms to buy and sell commodities online. You need to check whether the platforms are user-friendly enough and do not have technical issues. The safe way is to ask the broker for a demo before using the platform.
- Other than the market ups and downs, your profits or losses in trading depend on how efficient your broker is. For things to run smoothly, it is recommended that you have a good rapport with your broker and have mutual trust in each other.
Multi Commodity Exchange of India or MCX is where you can trade commodities. The MCX is termed as one of the largest commodity exchange in the world and the best commodity exchange in the country. NSE has also started with commodity. In addition to MCX, NCDEX is also a major commodity broker. The highest trading item in MCX is Gold. The trading process of commodities is called future transaction. A futures transaction happens when a trader buys a set of goods at a predetermined date based on predetermined prices. While trading on commodity futures in MCX, you have to pay the margins, which is just a fraction of the value of the contract. If you have a wise strategy and understand the market, then MCX trading can be beneficial for you. MCX trading mechanisms are secure and transparent and diligently work under the regulatory framework.