Investment Products in Commodities - National Spot Exchange Limited
Investment Products in Commodities - National Spot Exchange Limited
Investment Products in Commodities - National Spot Exchange Limited
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Commodity Market: In perspective<br />
� Growth has been phenomenal, but <strong>in</strong>struments are limited<br />
� Current structure provides <strong>in</strong>struments for :<br />
• Trad<strong>in</strong>g<br />
• Hedg<strong>in</strong>g/ Price Risk Management<br />
• Jobb<strong>in</strong>g<br />
• Speculation<br />
• Cash Future Arbitrage<br />
• No <strong>in</strong>vestment product available for retail and long term <strong>in</strong>vestors like equity( Free from<br />
daily MTM and roll over at the time of maturity)<br />
� Mass participation of retail <strong>in</strong>vestors <strong>in</strong> commodities is still absent, because of :<br />
• Futures contracts: High Risk, Leveraged Product<br />
• <strong>Investment</strong> <strong>in</strong> Physical <strong>Commodities</strong>: Complexity, absence of smooth exit, VAT<br />
compliance, Good for commodity traders only<br />
• ETF: High cost of trade and hold<strong>in</strong>g due to AMC charges<br />
� Therefore, <strong>in</strong>vestment products <strong>in</strong> commodities are required, which can address all<br />
these issues<br />
www.nationalspotexchange.com
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