QUOTE OF THE WEEK:
"My dreams and my goals motivate me to achieve and become successful in life. They motivate me to be the best person I can be" — Dr Rita Bakshi, Chairperson, International Fertility Centre, in Moneylife
YOUR FINANCE DEMYSTIFIED:
Understanding concept of online commodity trading
Broadly speaking, commodity trading is an activity which involves investing/trading in commodities. It is similar to stock trading but instead of buying and selling shares of companies, a trader buys and sells commodities. Commodities traded are often goods of value, consistent in quality and produced in large volumes by different suppliers such as wheat, coffee and sugar. Trading is affected by supply and demand, thus, limited supply causes a price increase while excess supply causes a price decrease. Therefore, the process of commodity trading is directly or indirectly affected by the demand and supply in the market.
Commodity trading is an investing strategy wherein goods are traded instead of stocks. Commodities can be traded on a spot level or on the futures exchanges as futures contracts. A futures contract is an agreement between two parties to buy or sell an asset at a certain time in the future at a certain price. A commodity future contract is a future contract which has a commodity as underlying asset... Read more
Basics of trading in commodities
There is a surging interest among investors in commodities, which as an asset class can provide opportunities to fine-tune a portfolio’s risk and return characteristics. The commodities asset class has experienced strong growth in recent years. The low historical correlation to financial assets, equity-like returns and risk characteristics of commodities provide investors a means to diversify their portfolios.
Commodities and futures: Commodities include goods used in the initial phase of the manufacturing process and are real assets such as energy, industrial and precious metals, agriculture, and livestock. Meanwhile, futures are contracts of commodities that are traded at a futures exchange.
However, futures contracts have expanded beyond just commodities and transactions now include futures contracts on financial markets, currencies and many others... Read more
DID YOU KNOW?
What is dematerialisation of securities?
As a share or debenture holder, it is important for you to be aware of the procedures to manage your investment in securities (the collective name for equity shares, debentures, bonds, mutual fund units etc.) Managing your investment in securities is simple and easy in electronic form (dematerialised form) and it has many advantages over managing it in physical form (share / debenture certificates). Accordingly, this write-up details dematerialisation of securities, its advantages and how to manage your investment in demat mode... Read more
TERM OF THE WEEK
Forward Markets Commission: Headquartered in Mumbai, FMC is a regulatory authority for commodity futures market in India. FMC is the chief regulator of forward and futures markets in India... Read more
IN THE NEWS THIS WEEK
RBI’s bi-monthly monetary policy statement on April 1
General insurers' premium income rises 19% to Rs. 73.81bn in Jan
MF assets continue to scale new highs: CRISIL
FLAME (Financial Literacy Agenda for Mass Empowerment) is an IIFL initiative to promote financial literacy amongst the masses in order to make them an integral part of India’s spectacular growth story.
In an era of accelerating GDP and rising per capita growth, financial literacy has become more critical than ever before such that we all reap the tangible benefits of the nation’s economic prosperity. Financial inclusion has been quite high on the governmental agenda, given its emphasis on widening the Banking & Financial services network across the country. IIFL’s FLAME initiative stands committed to complement this effort by helping common people gain financial growth and security though better awareness and education on the variety of financial products while avoiding the lure of and loss from unrealistic claims made by unscrupulous agents and ponzi schemes.
Our objective is to light a FLAME, as the name suggests, which will set ablaze a chain of FLAMEs across the country. The new-found light of knowledge will undoubtedly dispel the dark clouds of financial illiteracy and ensure the bright sunshine of financial growth and prosperity.
This portal is but one of the various IIFL initiatives that would be part of FLAME.