INTRODUCTION

Indian markets have recently thrown open a new avenue for retail investors and traders to
participate commodity derivatives. For those who want to diversify their portfolios beyond
shares, commodities bonds and real estate are the best options.
The retail investors could have done very little to actually invest in commodities such as crude
oil in the futures market.
However, with the setting up of three multi-commodity exchanges in the country, retail investors
can now trade in commodity futures without having physical stocks!
Commodities actually offer immense potential to become a separate asset class for market survey
investors, arbitrageurs and speculators. Retail investors, who claim to understand the equity
markets, may find commodities an unfathomable market.

But commodities are easy to

understand as far as fundamentals of demand and supply are concerned. Retail investors should
understand the risks and advantages of trading in commodities futures before taking a leap.
Historically, pricing in commodities futures has been less volatile compared with equity and
bonds, thus providing an efficient portfolio diversification option
Like any other market, the one for commodity futures plays a valuable role in information
pooling and risk sharing. The market mediates between buyers and sellers of commodities, and
facilitates decisions related to storage and consumption of commodities. In the process, they
make the underlying market more liquid.

COMMODITY TRADING:
COMMODITY MARKET TRADING MCHANISM:
Every market transaction consists of three components trading, clearing and settlement.
TRADING:
The trading system on the Commodities exchange provides a fully automated screen-based
trading for futures on commodities on a nationwide basis as well as an online monitoring and
surveillance mechanism. It supports an order driven market and provides complete transparency
of trading operations. After hours trading has also been proposed for implementation at a later
stage.
The COMEX system supports an order driven market, where orders match automatically. Order
matching is essentially on the basis of commodity, its price, time and quantity. All quantity fields
are in units and price in rupees. The exchange specifies the unit of trading and the delivery unit
for futures contracts on various commodities. The exchange notifies the regular lot size and tick
size for each of the contracts traded from time to time. When any order enters the trading
system, it is an active order. It tries to find a match on the other side of the book. If it finds a
match, a trade is generated. If it does not find a match, the order becomes passive and gets
queued in the respective outstanding order book in the system, Time stamping is done for each
trade and provides the possibility for a complete audit trail if required.
COMMODITY FUTURES TRADING CYCLE:
COMEX trades commodity futures contracts having one-month, two-month and three-month
expiry cycles. All contracts expire on the 20th of the expiry month. Thus a January expiration
contract would expire on the 20th of January and a February expiry contract would cease trading
on the 20th February. If the 20th of the expiry month is a trading holiday, the contracts shall
expire on the previous trading day. New contracts will be introduced on the trading day
following the expiry of the near month contract. Following Figure shows the contract cycle for
futures contracts on COMEX.

Jan

Feb

Mar

Apr

Time
Jan 20 contract
Feb 20 contract
March 20 contract
April 20 contract
May 20 contract
June 20 contract

Figure no: 1

ORDER TYPES AND TRADING PARAMETERS

An electronic trading system allows the trading members to enter orders with various conditions
attached to them as per their requirement.

These conditions are broadly divided into the

following categories:

Time conditions

Price conditions

Other conditions

Several combinations of the above are possible thereby providing enormous flexibility to users.
The order types and conditions are summarized below. Of these, the order types available on the
COMEX system are regular lot order, stop loss order, immediate or cancel order, good till day
order, good till cancelled order, good till order and spread order.
TIME CONDITIONS:
1. Good till day order:
A day order, as the name suggests is an order which is valid for the day on which it is entered. If
the order is not executed during the day, the system cancels the order automatically at the end of
the day Example: A trader wants to go long on March 1, 2004 in refined palm oil on the
commodity exchange. A day order is placed at Rs.340/- 10 kg. If the market does not reach this
price the order does not get filled even if the market touches Rs.341 and closes. In other words
day order is for a specific price and if the order does not get filled that day, one has to place the
order gain the next day.

2. Good till cancelled (GTC):

A GTC order remains in the system until the user cancels it. Consequently, it spans trading days,
if not traded on the day the order is entered. The maximum number of days an order can remain
in the system is notified by the exchange from time to time after which the order is automatically
cancelled by the system. Each day counted is a calendar day inclusive of holidays. The days
counted are inclusive of the day on which the order is placed and the order is cancelled from the
system at the end of the day of the expiry period. Example: A trader wants to go long on refined
palm oil when the market touches Rs.400/- 10 kg. Theoretically, the order exists until it is filled
up, even if it takes months for it to happen. The GTC order on the COMEX is cancelled at the
end of a period of seven calendar days from the date of entering an order or when the contract
expires, whichever is earlier.
3. Good till date (GTD):
A GTD order allows the user to specify the date till which the order should remain in the system
if not executed. The maximum days allowed by the system are the same as in GTC order. At the
end this day / date, the order is cancelled from the system. Each day / date counted are inclusive
of the day / date on which the order is placed and the order is Cancelled from the system at the
end of the day / date of the expiry period.
4. Immediate or Cancel (IOC):
An IOC order allows the user to buy or sell a contract as soon as the order is released into the
system, failing which the order is cancelled from the system. Partial match is possible for the
order, and the unmatched portion of the order is cancelled immediately.
5. All or none order:
All or none order ( AON) is a limit order, which is to be executed in its entirety, or not at all.
Unlike a fill-or-kill order, an all-or-none order is not cancelled if it is not executed as soon as it is
represented in the exchange. An all-or-none order position can be closed out with another AON
order.

6. Fill or Kill order:

This order is a limit order that is placed to be executed immediately and if the order is unable to
be filed immediately, it gets cancelled.

PRICE CONDITION:
1. Limit Order:
An order to buy or sell a stated amount of a commodity at a specified price, or at a better price, if
obtainable at the time of execution. The disadvantage is that the order may not get filled at all if
the price of that day does not reach specified price.
2. Stop-loss:
A stop-loss order is an order, placed with the broker, to buy or sell a particular futures contract at
the market price if and when the price reaches a specified level. Futures traders often use stop
orders in an effort to limit the amount they might lose if the futures price moves against their
position Stop orders are not executed until the price reaches the specified point. When
The price reaches that point the stop order becomes a market order. Most of the time, stop orders
are used to exit a trade. But, stop orders can be executed for buying / selling positions too. A
buy stop order is initiated when one wants to buy a contract or go long and a sell stop order when
one wants to sell or go short. The order gets filled at the suggested stop order price or at a better
price. Example: A trader has purchased crude oil futures at Rs.750 per barrel. He wishes to limit
his loss to Rs.50 a barrel. A stop order would then be placed to sell an offsetting contract if the
price falls to Rs.700 per barrel. When the market touches this price, stop order gets executed and
the trader would exit the market. For the stop-loss sell order, the trigger price has to be greater
than the limit price.

NEED OF THE STUDY:

Achieving hedging efficiency is the main reason to opt for futures contracts. For instance, in
February, 2007, India had to pay $ 52 per barrel more for importing oil than what they had to pay
a week ago. The utility of a futures contract for hedging or risk management purpose parallel or
near-parallel relationship between the spot and futures prices over time. In other words, the
efficiency of a futures contract for hedging essentially envisages that the prices in the physical
and futures markets move in close union not only in the same direction, but also by almost the
same magnitude, so that losses in one market are offset by gains in the other.
Theoretically ( and ideally), in a perfectly competitive market with surplus supplies and abundant
stocks round the year, the futures price will exceed the spot price by the cost of storage till the
maturity of the futures contract. But such storage cost declines as the contract approaches
maturity, thereby reducing the premium or contango commanded by the futures contract over the
spot delivery over its life and eventually becomes zero during the delivery month when the spot
And futures prices virtually converge. The efficiency of a futures contract for hedging depends
on the prevalence of such an ideal price relationship between the spot and futures markets

OBJECTIVES OF THE STUDY:

To Analyze Crude oil price movements at Comex

To study the behaviour of crude oil commodities.

To compare the volatility of the moment of the crude oil as commodity with that of index.

To understand the trading in crude oil as commodity futures.

To know the trading of crude oil

To know the factor effecting crude oil

METHODOLOGY OF THE STUDY

The data used in the project is secondary in nature & collected from various websites, news
paper and from the commodities head (Asst manager) of the organization.
Data Collection:
The data of the Crude oil has been collected from the news paper & internet.
Analysis:
The analysis consists of the tabulation of the data assessing the profitability positions of the
Commodity futures, representing the data making the interpretation using data.

SCOPE OF THE STUDY:

The study mainly focuses on Indian commodity market, its history and latest development in the
Indian commodity market. The scope of the study limited to Indian commodity market. The
study vastly covered the accepts of commodity market, clearing house and settlement
mechanisms in Indian commodity market. A study also keeps a birds-eye view on global
commodity market and its development. The study of conducted for a period of six months.

LIMITATIONS OF THE STUDY:

The following are the limitation of this study

The study is conducted in short period, due to which the study may not be detailed all
aspect.

Lack of time on performing the project in detail study.

The scrip chosen for analysis in CRUDEOIL.

The data collected is completely restricted to July and Aug; hence this analysis cannot
be taken universal.

CHAPTER 2
LITERATURE REVIEW

REVIEW OF LITERATURE
Meaning and Objectives of commodity futures
A commodity futures contract is a contractual agreement between two parties to buy or
sell a specified quantity and quality of commodity at a certain time in future at a certain price
agreed at the time of entering into the contract on the commodity futures exchange.
Objectives and benefits of commodity futures are as follows

Hedging - price risk management by risk mitigation

Speculation - take advantage of favourable price movements

Leverage - pay low margin to enjoy large exposure

Liquidity - ease of entry and exit of market

Price discovery - for taking farming and business decisions

Price stabilization along with balancing demand and supply position

Facilitates integrated price structure

Flexibility, certainty and transparency in purchasing commodities facilitate bank

financing

Facilitates 'informed' lending by the banks

The primary objectives for any futures exchange are effective price discovery and

efficient price risk management. In commodity futures, it is necessary to distinguish between

investment commodities and consumption commodities. An investment commodity is generally
held for investment purposes whereas consumption commodities are held mainly for
consumption purposes. Crude oil can be classified as investment commodities whereas oil can be
classified as consumption commodities.

Difference between Cash and Future market

Cash market is the market for buying and selling physical commodity at a negotiated
price. Delivery of the commodity takes place immediately.
Futures market is the market for buying and selling standardized contract of the
commodity at a pre-determined price. Delivery of the commodity takes place during a future
delivery period of the contract if the option of delivery is exercised.
Difference between Futures and Forward contract

By Definition
Futures contract is an agreement between two parties to buy or sell a specified quantity
and quality of asset at a certain time in future at a certain price agreed at the time of entering into
the contract on the futures exchange.
Forward contract is an agreement entered between two parties to buy or sell an asset at a
future date for an agreed price. Forward contract is not traded on an exchange.

Trading place: Futures contract is entered on the centralized trading platform of the
exchange. Forward contract is OTC in nature.

Size of the contract: Futures contract is standardized in terms of quantity and quality as
specified by the exchange. Size of the forward contract is customized as per the terms of
agreement between the buyer and seller.

Transparency in contract price: Contract price of futures contract is transparent as it is

available on the centralized trading screen of the exchange. Contract price of forward
contract is not transparent, as it is not publicly disclosed.

Valuation of open position and margin requirement: In case of futures contract, valuation
of open position is calculated as per the official closing price on a daily basis and Markto-Market margin requirement exists. In case of forward contract, valuation of open
position is not calculated on a daily basis and there is no provision of Mark-to-Market
margin requirement.

Liquidity: Futures contract is more liquid as it is traded on the Exchange. Forward

contract is less liquid due to its customized nature and mutual trade.

Counter party risk: In futures contract the Clearing House becomes a counter party to
each transaction, which is called Novation, making counter party risk nil. In forward
contract, counter party risk is high due to decentralized nature of the transaction.

Regulations: Futures contract is regulated by a government regulatory authority and the

Exchange. Forward contract, is not regulated by any authority or exchange..

Settlement: Futures contract can be settled in cash or physical delivery, depending on the
commodity futures contract specification. Forward contract is generally settled by
physical delivery.

Delivery: Delivery tendered in case of futures contract should be of a standard quantity

and quality as per contract specifications, at designated delivery centres of the Exchange.
Delivery in case of forward contract is carried out at delivery centre specified in
customized bilateral agreement.

EMERGING TRENDS IN COMMODITY MARKET IN INDIA:

Commodity markets have existed in India for a long time, below Table gives the list of registered
commodities exchanges in India. Above Table gives the total annualized volumes on various
exchanges.
While the implementations of the Kara committee recommendations were rather slow, today, the
commodity derivative market in India seems poised for a transformation.

National level

commodity derivatives exchanges seem to be the new phenomenon. The Forward Markets
Commission accorded in principle approval for the following national level multi commodity
exchanges. The increasing volumes on these exchanges suggest that commodity markets in India
seem to be a promising game.
Commodity Exchanges Registered in India
Commodity Exchange
Bhatinda Om & Oil Exchange Ltd.,

Products Traded
Gur
Sunflower Oil

Cotton ( Seed and Oil)

Safflower ( Seed , Oil and Oil Cake)
The Bombay commodity Exchange Groundnut ( Nut and Oil)
Ltd

Castor Oil, Castor seed

Sesamum ( Oil and Oilcake)
Rice bran, rice bran oil and oil cake

Crude palm oil

The Rajkot Seeds Oil & Bullion Groundnut Oil, Castro Seed
Merchants Association Ltd.
The Kanpur Commodity Exchange Rapeseed / Mustard seed oil and cake.
Ltd.,
Te Meerut

Agro

commodities Gur

Exchange Co., Ltd.

The Spices and Oilseeds exchange Turmeric
Ltd., Sangli
Ahmadabad Commodities Exchange Cottonseed, castor seed
Ltd
Vijay

Beopar

Muzaffarnagr
India Pepper

Chamber
&

Spice

Association, Kochi
Rajadhani Oils and

Ltd., Gur
Trade Pepper

Oil

seeds Gur, Rapeseed / Mustard Seed Sugar Grade M

Exchange Ltd.,Delhi
Rapeseed / Mustard Seed / Oil / Cake
Soyabean / Meal / Oil / Crude Palm Oil
National Board of Trade, Indore
The Chamber of Commerce, Hapur
Gur, Rapeseed / Mustard seed
The East India Cotton Association, Cotton

Mumbai
The central

India

Commercial Gur

Exchange Ltd Gwalior

The east India Jute & Hessain Hessain, Sacking
Exchange Ltd., Kolkata
First Commodity Exchange of India Copra, Coconut Oil & Copra Cake
Ltd., Kochi
The Coffee Futures Exchange India Coffee
Ltd Bangalore
Gur RBD Pamolien
Crude Palm Oil, Copra
Rapeseed / Mustard Seed, Soy Bean
Cotton ( Seed, Oil, Oil Cake)
Safflower ( Seed, Oil, and Oil cake)
National Multi Commodity Exchange Ground nut ( Seed, Oil, and Oil cake)
of India Ltd., / Ahmadabad

Sugar, Sacking, Gram

Coconut ( Oil and Oilcake)
Castor ( Oil and Oilcake)
Sesamum ( Seed, Oil, and Oil cake)
Linseed ( Seed, Oil, and Oil cake)
Rice Bran Oil, Pepper, Guar seed Aluminium ingots,
Nickel, tin Vanaspati, Rubber, Copper, Zinc, Lead

Table no:1

REGULATORY FRAMEWORK FOR COMMODITY TRADING IN INDIA:

At present there are three tiers of regulations of forward/futures trading system in India, namely,
government of India, Forward Markets Commission (FMC) and commodity exchanges. The
need for regulation arises on account of the fact that the benefits of futures markets accrue in
competitive conditions.
Proper regulation is needed to create competitive conditions. In the absence of regulation,
unscrupulous participants could use these leveraged contracts for manipulating prices. This
could have undesirable influence on the spot prices, thereby affecting interests of society at large.
Regulation is also needed to ensure that the market has appropriate risk management system. In
the absence of such a system, a major default could create a chain reaction.
The resultant financial crisis in a futures market could create systematic risk. Regulation is also
needed to ensure fairness and transparency in trading, clearing, settlement and management of
the exchange so as to protect and promote the interest of various stakeholders, particularly nonmember users of the market

INSIGHTS

OF

MARKET

&

TRADING

SPECIFICATIONS

FOR

COMMODITIES

CRUDE OIL:
A mineral oil consisting of a mixture of hydrocarbons of natural origin, yellow to black in color/
of variable specific gravity and viscosity; often referred to simply as crude.

VARIETIES OF CRUDE OIL:

The petroleum industry often characterizes crude oils according to their geographical source.
E.g. / Alaska North Slope Crude. Oils from different geographical areas have unique properties;
they can vary in consistency from a light volatile fluid to a semi-solid. The classification scheme
provided below is more useful in a response scenario.
Class A : Light /Volatile Oils These oils are highly fluid, often clear/spread rapidly on solid or
water surfaces/have a strong odor/ a high evaporation rate/sand/ and may be persistent in such a
matrix. They do not tend to adhere to surfaces; flushing with water generally removes them.
Class A oils may be highly toxic to humans/fish/and other biota. Most refined products and
many of the highest quality light crudes can be included in this class.

Class B: Non-Sticky Oils These oils have a waxy or oily feel. Class B oils are less toxic and
adhere more firmly to surfaces than Class A oils/although they can be removed from surfaces by
vigorous flushing. As temperatures rise/their tendency to penetrate porous substrates increases
and they can be persistent. Evaporation of volatilize may lead to a Class C or D residue.
Medium to heavy paraffin-based oils fall into this class.

Class C: Heavy/Sticky Oils Class C oils are characteristically viscous/sticky or tarry/and

brown or black. Flushing with water will not readily remove this material from surfaces/but the
oil does not readily penetrate porous surfaces. The density of Class C oils may be near that of
water and they often sink. Weathering or evaporation of volatilize may produce solid or tarry
Class D oil. Toxicity is low/ but wildlife can be smothered or drowned when contaminated. This
class includes residual fuel oils and medium to heavy crudes.

Class D: No fluid Oils Class D oils are relatively non-toxic/do not penetrate porous substrates
and are usually black or dark brown in color. When heated, Class D oils may melt and coat
surfaces making cleanup very difficult. Residual oils, heavy crude oils/some high paraffin
oils/and some weathered oils fall into this class.

These classification are dynamic for spilled oils, weather conditions and water temperature
greatly influence the behaviour of oil and refined petroleum products in the environment. For
example, as volatiles evaporate from as Class B oil, it may become Class C oil. If a significant
temperature drop occurs (e.g., at night), a Class C oil may solidify and resemble a Class D oil.
Upon warming the Class D oil may revert back to a Class C oil.

Categories of Crude Oil:

West Texas Intermediate (WTI) crude oil is of very high quality. Its API gravity is 39.6
degrees (making it a light crude oil). WTI is generally priced at about a $2-4 per-barrel
premium to OPEC Basket price and about #1-2 per barrel premium to Brent, although on
a daily basis the pricing relationships between these can very greatly.

Brent Crude Oil stands as a benchmark for Europe.

India is very much reliant on oil from the Middle East (High Sulphur). The OPEC has
identified China & India as their main buyers of oil in Asia for several years to come.

India in World Crude Oil Industry:

Petroleum and Natural Gas; The recent exploration and production activities in the country have
led to a dramatic increase in the output of oil. The country currently produces 35 million tonnes
of crude oil, two-thirds of which is from offshore areas, and imports another 27 million tonnes.
Refinery production in terms of crude throughput of the existing refineries is about 54 million
tonnes.

Natural gas production has also increased substantially in recent years, with the country
producing over 22,000 million cubic metres. Natural gas is rapidly becoming an important
source of energy and feedstock for major industries. By the end of the Eighth Five-Year Plan,
production was likely to reach 30 billion cubic metres.

Factors influencing Crude Oil Markets:

Shortage of oil supplies

Taxation When oil taxes are raised, end consumers often mistakenly blame, the oil
producers, but it is really their own governments that are responsible.

Balance of demand and supply in the short term

Rate of investment in the longer term

Accidents

Bad weather

Increasing demand

Halting transport of oil from producers

Labour disputes.

If traders in the oil market believe there will be a Jffirtage of oil supplies, they may raise
prices before a shortage occur

Causes of low Oil Prices:

Imbalance between supply and demand. If oil production rises faster than demand.

If the oil industry is unprofitable and discourages investors.

Causes of high Oil Prices:

Shortage of oil supplies

Balance of demand and supply in the short term

Rate of investment in the longer term

If traders in the oil market believe there will be a shortage of oil supplies, they may raise
prices before a shortage occurs.

War, Natural disasters

Crude Oil reserves:

World crude oil reserves are estimated at more than one trillion barrels/of which the 11 OPEC
Member Countries hold more than 75 percent. OPECs Members currently produce around 27
million to 28 million barrels per day of oil, or some 40 per cent of the world total output, which
stands at about 75 million barrels per day.

Is the world running out of oil? Oil is a limited resource, so it may eventually run out,
although not for many years to come, OPECs oil reserves are sufficient to last another 80
years at the current rate of production, while non-OPEC oil producers reserves might last
less than 20 years. The worldwide demand for oil is rising and OPEC is expected to be an
increasingly important source of that oil.
If we manage our resources well, use the oil efficiently and develop new fields, then our oil
reserves should last for many more generations to come.

Uses of Crude Oil:

Gasoline, petrol liquefied, petroleum gas (LPG), naphtha, kerosene, gas oil, fuel oil, lubricants,
asphalt(used in paving roads), naphtha, gas oil, ethane, ethylene, propylene, butadiene, benzene,
ammonia, methanol, plastics, synthetic fibers, synthetic rubbers, detergents, chemical fertilizers.

Exchanges dealing in Crude Futures apart from MCX

The New York Mercantile Exchange (COMEX)

The International Petroleum Exchange of London (IPE)

The Tokyo Commodity Exchange (TOCOM)

Crude Oil Units (average gravity)

1 US barrel = 42 US gallons

1 US barrel = 158.98 liters

1 tonne = 7.33 barrels

1 short ton = 6.65 barrels

Note: barrels per tone vary from origin to origin.

CHAPTER 3
COMPANY PROFILE

COMPANY PROFILE
Optimus is one of the leading and fast growing commodity brokers and occupied its place in the
good books of investors. At Optimus we believe in Research... Reliability.... Resposibility. We
are led by experienced professionals with deep domain knowledge on Commodity
derivatives.Being a member of MCX, we facilitate online trading on various commodities like
Bullion, Energies, Non ferrous metals, Pulses, grains, Spices, Eddible oils and others.We started
our journey in 2003 at Vijayawada and spread our wings to many places by establishing nearly
40 franchises in A.P.
We are very strong in designing risk management strategies by taking advantages of spreading,
hedging and Arbitraging. Its been 3 years since futures trading re-emerged in India. A daily
average turnover of nearly 20,000 crores is recorded in india at a growth rate of 600%. This
attracts every investor and they need a right broker to serve their purpose. We are here to bridge
the gap and make our clients know perfect before they start trading. We consider every client of
ours as an individual while many brokerage firms consider as numbers.
Our vision is to churn the advantages of commodity futures trading and justify the investments of
all our clients.
At Optimus, we believe in service and support. Analysis is said to be the major support expected
by every trader and investor when it comes to Commodity trading. Analysis are two types,
Technical and Fundamental. We have a separate team of Analysts to support our valuable Clients.
A team of fundamental Analyst at our office observe various developments in all domestic and

international commodities. They watch the ratio of supply, demand. Weather, Government
policies etc., and update the same to our clients. The other set of Analysts observe the markets by
reading graphical representations of various commodities and design the trading strategies to
share with our clients through out the day. To assist our clients in terms of technical analysis we
use various state of the art soft wares for better productivity. In other words, Every trade
executed at Optimus does have a logic behind it( either technical or fundamental).

Mechanics of the futures trading

Forward contract is an agreement between two parties in which the seller agrees to deliver to the
buyer a specified quantity and quality of an asset or commodity at a specified future date at an
agreed upon price. A forward contract is a privately negotiated bilateral contract that is not
conducted on an organized market place or exchange. The contract terms are not standardized
but are determined by what the parties agree on. The price generally is determined when the
contract is entered into, although there are some forward contracts where the parties may agree to
transact at a price to be determined later in a manner that is specified on the day the contract is
entered into.
Forward contract

Futures contract

Bilateral agreement

Standardized agreement

Flexible covenant

Necessity of a physical delivery or termination

of the position before maturity

Replaces spot transactions on many Buyer and seller only refer to the clearinghouse
occasions
Form of contracting totally

Central clearing mechanism generating 'market

appropriate for commodities

prices'

Credit risk fully present

Price transparency

Flexibility regarding the optimal

Liquidity & low transaction costs

transfer of goods

Clearing houses Futures

Trades that are made on an exchange are cleared through clearing houses that act as the buyers to
all sellers an the sellers to all buyers. When a trader/participant enters into a futures contract, he
is technically buying form or selling to, the clearing house rather than the party with whom he
executed the transaction on the trading floor or through an electronic trading platform. Thus,
since he ultimately buys an d sells from the same party, if he buys a futures contract and
subsequently sells it, he has offset his position and the contract is extinguished. On the other
hand, if he buys a forward contract and then sells an identical forward contract to a different
person, he has obligations under two contracts (one long and one short).

Margins
In futures trading, the entire value of a contract need not be paid rather, a margin that is typically

between 2 percent and 10 percent of the total value of the contract need to be paid while entering
into the contract.

Initial margin
When a futures trader enters into a futures position , he or she is required to post initial margin of
an amount specified by the exchange or clearing organization.
Thereafter, the margin becomes "marked-to market" and the margin account will be adjusted
automatically according to the changes in futures price.
Maintenance margin: The minimum level at which the equity in a futures account must be
maintained. If the equity in an account falls below this level, a margin call be issued, and funds
must be added to bring the account back to the initial margin level. The maintenance margin
level generally is normally 75 percent of the initial margin requirement. If the amount of money
in the margin account falls below the specified maintenance margin, the futures trader will be
required to post additional variation margin to bring the account up the initial margin level and if
the futures position is profitable, the profits will be added to the margin account.

Risk management strategies

Primary purpose of derivatives trading in commodities is aimed to reduce the risk mainly from
the price fluctuations. The strategies of risk aversion include hedging, speculation and arbitrage.
Hedging is an economic function that helps to reduce the price risks in commodities
significantly, if not eliminate altogether. Hedging is the practice of off-setting the price risk
inherent in any cash market position by taking an equal but opposite position in the futures
markets, Futures market believed to be originally developed to meet the requirements of hedgers
or producers who wanted to safeguard against the price risk. However, the scope of commodity
futures has expanded latter with widespread participation of producers and users of the
commodities. Hedger is the person who basically wants to avoid risk and enters into a contract
with speculator. Hedging as a mechanism of avoiding exposure to risk of fluctuating prices in
futures markets will be effective only when the following requirements are met
Driven by the demand and supply over a period the prices of cash and futures markets tend to
move together.
As the maturity date approaches, cash and futures prices tend to converge or reach a predictable
difference called the basis.
Process: Hedging in the futures market in general is a two-step process, depending upon the
hedger's cash market situation
First step: If the hedger is going to buy a commodity in the cash market at a later time, his first
step is to buy futures contract. Or if he is going to sell a cash commodity at a later time, his first
step in the hedging process is to sell futures contracts.
Second step: When a cash market transaction takes place, the futures position is no longer
needed for price protection and should therefore be offset (closed out). Depending on the initial
position taken long (long hedge) or short ( short hedge), hedger would offset his position by
selling or buying back the futures contract. Both the opening and closing positions must be for
the same commodity, number of contracts, and delivery month.

For example, in June if a farmer expects on output of 100 tones of the soyabean in October. Soya
bean prices in October are expected to rule relatively lower as it is harvesting season for soya
bean. In order to hedge against the price fall, the farmer/producer sells 100 contracts of one tone
each at Rs 1347 on June 22, 2005. On a fall of price to Rs 1216 per tone in October he makes
profit of Rs 131 per tone.
Speculation: Contrary to the hedging, speculation involves risk but no offsetting of cash market
position. Speculators on the other hand, wish to take risk that hedgers want to avoid with a
motive to make profits and provide the necessary liquidity through bids and offers that result into
a continuous flow of transactions. Commodities are becoming increasingly attractive to investor
and hedge fund managers as an alternative asset class that may allow reduction in overall risk of
financial portfolio and enhance returns.
For example if an investor wants to diversify his investment portfolios, he can chose
commodities as a bright option. Unlike in spot markets, he has to invest only a margin amount
instead of the total amount and can gain profits to the total extent.
Arbitrage: A third category of market participants is the arbitragers. Arbitrage is a risk-less
profit realized by simultaneous trading in two or more markets. However, arbitrage the prices get
adjusted soon with buying and selling.

Arbitrage is possible when one of three conditions is met

The same asset must trade at the different prices on all markets ("the law of one price")
Two

assets

with

identical

cash

flows

must

trade

at

different

prices.

An asset with a known price in the future, must trade today at a different price than its future
priced discounted at the risk-free interest rate.
For example, spot price of gold in Mumbai is Rs 8000 per 10 gm and at the same time the futures
contract on MCX is traded at Rs 8200 per gm then the trader buys a kg of gold in cash market
and simultaneously takes a short position in the futures market. On the expiry of the contract he
opts to deliver the physical gold and gains at the rate of Rs 200 per 10 gm.
Basis and basis risk

Understanding basis risk is fundamental for hedging in futures trading

Basis t, T = Spot price t - Futures price T (t
Where T is maturity period and t is a specific date
It is normally quoted as premium or discount in relation to the cash price.
If

Sp

>

Fp

then

basis

is

said

to

be

OVER

future

and

called

premium

If Sp < Fp then basis is said to be UNDER future and called discount

Example: On a particular day (October 1 ) if a trader purchases soyabean in Indore market at a
price of Rs 1180 per quintal and on the same day, October futures contract closed at Rs 1208 per
quintal then the basis could be calculated by subtracting the futures price from spot price (Rs 28)
The basis is partly determined by the interest on difference between margin deposit and the total
value of the contract and partly by storage costs. Thus, futures prices for physical commodities
are typically higher than spot prices, a situation known as Contango. Differences in quality and
grade as well as expectations about future supply also can affect the basis. If expected future
supplies greatly exceed current supplies, futures prices may be lower than spot prices, a situation
known as backwardation.

CHAPTER 4
DATA ANALYSIS AND
INTERPRETATION

DATA ANALYSIS
The tools which are used for analyzing the crude oil prices are as follows:
1. Relative Strength Index - RSI
A technical momentum indicator that compares the magnitude of recent gains to recent losses in
an attempt to determine overbought and oversold conditions of an asset. It is calculated using the
following formula:

100
RSI = 100 - ______
1 + RS
RS = Average of x days' up closes / Average of x days' down closes
The RSI ranges from 0 to 100. An asset is deemed to be overbought once the RSI approaches the
70 level, meaning that it may be getting overvalued and is a good candidate for a pullback.
Likewise, if the RSI approaches 30, it is an indication that the asset may be getting oversold and
therefore likely to become undervalued.

Relative Strength Index:

As you can see the above chart, the RSI values always range from 30 to 90.

As we can see that in between September 2011 and January 2012 the RSI ranges between
50 to 80 which indicate that it is in overbought position and the price has fallen from
$91to $92. Once the RSI approaches to 80 levels, meaning that it may be overvalued and
getting ready for a pull back.

In the month of January 2012 RSI approaches 50, it is an indication that crude oil is
oversold and therefore likely to becomes undervalued.

Similarly between January 2013 and March 2013 the RSI ranges between 40 to 60 which
happened as an upward momentum in the price which rose from $92 to $95.

2. MACD:
Moving Average Convergence Divergence - MACD.
A trend-following momentum indicator that shows the relationship between two moving
averages of prices. The MACD is calculated by subtracting the 26-day exponential moving
average (EMA) from the 12-day EMA. A nine-day EMA of the MACD, called the "signal line",
is then plotted on top of the MACD, functioning as a trigger for buy and sell signals.
There are three common methods used to interpret the MACD:
1. Crossovers
2. Divergence
3. Dramatic rise
Traders recognize three meaningful signals generated by the MACD indicator.

The MACD line crosses the signal line.

The MACD line crosses the zero.

There id divergence between the MACD line and the price of the stock or between the
histogram and the price of the stock.

MACD Study:

As we can see that MACD falls below the signal line (below 0) in the month of feb 2012,
it showed a bearish signal, which indicated that it may break from $91 in feb 2013 around
to $94 in March 2013 which was a good sell point.

Similarly, mid of August 2012 , till September 2012 A MACD rises above the signal
line, (above 50) the indicator gives a bullish signal, by which the price of crude oil
futures will experience an upward momentum which happened as the price rose from
$91.86 to around $94.33.

Also, we can see from the candle stick chart that the MACD signal line is rising which
indicated a bullish trend. MACD reading is around 60 with a price touching above
$94.86.

As indicated from the above chart between jan 2013 and feb 2013, the price of crude oil
has seen some good volatility and the price which was trading between $91 and $91.8 has
finally touched the high of $92 after breaking the strong support at $91.8.

3. Bollinger Band Study:

Bollinger Bands plot trading bands above and below a simple moving average. The standard
deviation of closing prices for a period equal to the moving average employed is used to
determine the band width. This causes the bands to tighten in quiet markets and loosen in volatile
markets. The bands can be used to determine overbought and oversold levels, locate reversal
areas, project targets for market moves, and determine appropriate stop levels. The bands are
used in conjunction with indicators such as RSI, MACD histogram, CCI and Rate of Change.

Divergences between Bollinger bands and other indicators show potential action points. As a
general guideline, look for buying opportunities when prices are in the lower band, and selling
opportunities when the price activity is in the upper band.

Figure no:2
Bollinger band study:

From the above chart we can see that the Bollinger band indicated that from April 2012 to
April 2013 the price range was between $91and $95 which showed that market was
moving in the range bound except in January 2013 it broken the strong resistance of $90.

Also we can see that the Bollinger band in 2012 was $91.95 which experienced an
upward momentum till 2013 to around $95.96 and a good opportunity for the investors to
sell as the price brand is high.

TECHNICAL ANALYSIS SUMMARY

Daily Quotes

Period
5-Day
20-Day
50-Day
100-Day
200-Day
Year to Date

Moving Average
90.98
93.68
94.25
90.82
90.36
94.52

Price Change
+1.27
-3.88
+3.34
+0.09
+0.29
+0.13

Period

Raw Stochastic

Stochastic %K

Stochastic %D

9-Day
14-Day
20-Day
50-Day

69.32%
27.98%
24.76%
23.40%

42.59%
18.10%
16.15%
24.84%

27.31%
11.90%
10.86%
23.19%

100-Day

55.63%

50.91%

47.87%

Period
9-Day
14-Day
20-Day
50-Day
100-Day

Relative Strength
43.41%
42.90%
44.95%
49.42%
49.77%

Percent R
30.68%
72.02%
75.24%
76.60%
44.37%

Table no:2

Percent Change Average Volume

+1.40%
-4.05%
+3.77%
+0.10%
+0.32%
+0.14%
Average True
Range
0.70
0.70
0.71
0.80
0.93

Historic Volatility MACD Oscillator

12.74%
-0.13
15.68%
-1.06
15.42%
-2.37
14.63%
-2.94
19.35%
+0.49

Figure no:3
Interpretaion: As from the above figure we can observe that the price of crude oil increases i.e
from 91.74 to 94.08

Interpretaion : As by oberserving the above figure we can understand that the prices of crude
oil is fluctuation with in a day. i.e from 91.83 to 105.04

Figure no:5
Last
Open

91.81
91.83

COMEX Crude Oil Continuous Contract

Change
-0.06
Change %
High
91.92
Low

-0.07%
91.

Technical Analysis Summary Weekly Quotes

Period
6-Week
6-Month
1-Year
3-Year
5-Year

Moving Average
94.18
91.21
92.65
90.57
85.89

Price Change
-3.93
-4.47
-15.45
+10.71
-18.26

Period

Raw Stochastic

Stochastic %K

Stochastic %D

9-Week
14-Week
20-Week
50-Week
100-Week

23.40%
51.62%
55.63%
48.11%
42.55%

50.83%
51.37%
55.41%
47.21%
42.47%

63.86%
63.13%
65.99%
51.48%
46.21%

Period
9-Week
14-Week
20-Week
50-Week
100-Week

Relative Strength
47.94%
49.36%
49.44%
50.06%
50.80%

Percent R
76.60%
48.38%
44.37%
51.89%
57.45%
Table no:3

Percent Change Average Volume

-4.10%
-4.64%
-14.39%
+13.18%
-16.57%

Average True
Range
2.35
2.55
2.77
3.42
3.84

Historic Volatility MACD Oscillator

13.24%
-2.54
14.78%
-0.60
15.02%
+1.15
21.15%
-0.16
26.42%
-2.37

Figure no:6

Analysis
Support: 91.50, 91.15, 90.85, 90.00, and 89.30
Resistance: 92.00, 93.00, 93.45, 94.00, And 94.40
Recommendation Based on the charts and explanations above, we prefer to long oil around
91.50 targeting 92.00 and 93.00. Stop loss below 90.80
Crude oil moved higher on Friday, to retest 92.0 resistance areas, the commodity maintained the
bullish momentum after completing the double bottom shown on the four-hour chart above. The
bullish bias is likely this week, and a break above 91.95-92.00 would give it further
confirmation.
Crude Oil WTI (CLY00)

91.95s+0.39 (+0.43%) 7:57P CST (COMEX)

Detailed Quote as of Friday, Mar 8th, 2013

Daily Quotes

Weekly Quotes

Monthly Quotes

Date

Open

High

Low

Last

Change

% Change

Volume

03/08/13

0.00

91.95

91.95

91.95

+0.39

+0.43%

03/07/13

0.00

91.56

91.56

91.56

+1.13

+1.25%

03/06/13

0.00

90.43

90.43

90.43

-0.39

-0.43%

03/05/13

0.00

90.82

90.82

90.82

+0.70

+0.78%

03/04/13

0.00

90.12

90.12

90.12

-0.56

-0.62%

Detailed Quote as of Monday, Mar 11th, 2013

Technical Analysis Summary

Daily Quotes
Period
5-Day
20-Day
50-Day
100-Day
200-Day
Year to Date

Moving Average
90.98
93.68
94.25
90.82
90.36
94.52

Price Change
+1.27
-3.88
+3.34
+0.09
+0.29
+0.13

Percent Change Average Volume

+1.40%
-4.05%
+3.77%
+0.10%
+0.32%
+0.14%

Period

Raw Stochastic

Stochastic %K

Stochastic %D

9-Day
14-Day
20-Day
50-Day

69.32%
27.98%
24.76%
23.40%

42.59%
18.10%
16.15%
24.84%

27.31%
11.90%
10.86%
23.19%

100-Day

55.63%

50.91%

47.87%

Period
9-Day
14-Day

Relative Strength
43.41%
42.90%

Percent R
30.68%
72.02%

Average True
Range
0.70
0.70
0.71
0.80
0.93

Historic Volatility MACD Oscillator

12.74%
-0.13
15.68%
-1.06

20-Day
50-Day
100-Day

44.95%
49.42%
49.77%

75.24%
76.60%
44.37%

15.42%
14.63%
19.35%

-2.37
-2.94
+0.49

weekly information as of Mar 08, 2013, based on weekly nearest futures data.

Technical Analysis Summary Weekly Quotes

Period
6-Week
6-Month
1-Year
3-Year
5-Year

Moving Average
94.18
91.21
92.65
90.57
85.89

Price Change
-3.93
-4.47
-15.45
+10.71
-18.26

Percent Change Average Volume

-4.10%
-4.64%
-14.39%
+13.18%
-16.57%

Period

Raw Stochastic

Stochastic %K

Stochastic %D

9-Week
14-Week
20-Week
50-Week
100-Week

23.40%
51.62%
55.63%
48.11%
42.55%

50.83%
51.37%
55.41%
47.21%
42.47%

63.86%
63.13%
65.99%
51.48%
46.21%

Period
9-Week
14-Week
20-Week
50-Week
100-Week

Relative Strength
47.94%
49.36%
49.44%
50.06%
50.80%

Percent R
76.60%
48.38%
44.37%
51.89%
57.45%

Range
2.35
2.55
2.77
3.42
3.84

Historic Volatility MACD Oscillator

13.24%
-2.54
14.78%
-0.60
15.02%
+1.15
21.15%
-0.16
26.42%
-2.37

Crude Oil WTI Cash (CLY00)

91.95s+0.39 (+0.43%) 7:57P EST

Monthly information as of Mar 09, 2013, based on monthly nearest futures data.

Technical Analysis Summary

Monthly Quotes

Average True

Period
6-Month
2-Year
5-Year
10-Year
20-Year

Moving Average
91.41
94.93
86.46
72.02
46.80

Price Change
-0.24
-14.77
-9.64
+60.92
+71.52

Period

Raw Stochastic

Stochastic %K

9-Month
14-Month
20-Month
50-Month
100-Month

53.77%
44.45%
47.74%
72.51%
53.23%

63.57%
50.31%
53.26%
75.12%
54.87%

Period
9-Month
14-Month
20-Month
50-Month
100-Month

Relative Strength
49.05%
50.17%
51.04%
52.80%
53.48%

Percent R
46.23%
55.55%
52.26%
27.49%
46.77%

Percent Change Average Volume

-0.26%
-13.84%
-9.49%
+196.33%
+350.07%
Stochastic %D

Average True

59.16%
49.56%
50.64%
75.02%
54.54%

Range
7.55
8.41
8.98
9.04
7.53

Historic Volatility MACD Oscillator

17.92%
+2.14
24.61%
+0.14
27.04%
+0.31
27.15%
+8.67
32.57%
+14.66

Figure no:7

Spot prices of Crude Oil:

Date
1-Jul-11
2-Jul-11
3-Jul-11
5-Jul-11
6-Jul-11
7-Jul-11
8-Jul-11
9-Jul-11
10-Jul-11
12-Jul-11
13-Jul-11
14-Jul-11
15-Jul-11
16-Jul-11
17-Jul-11
19-Jul-11
20-Jul-11
21-Jul-11
22-Jul-11
23-Jul-11
24-Jul-11
26-Jul-11
27-Jul-11
28-Jul-11
29-Jul-11
30-Jul-11
31-Jul-1
2-Aug-11
10
4-Aug-11
5-Aug-11
6-Aug-11
7-Aug-11
9-Aug-11
10-Aug-11
11-Aug-11
12-Aug-11
13-Aug-11
14-Aug-11

Commodity

Contract/Expir

Symbol
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL
CRUDEOIL

y Month
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11
17-Dec-11

Close(Rs
Open(Rs)
3708
3635
0
3619
3624
3613
3620
3736
3735
3710
3680
3750
3744
3730
0
3737
3763
3780
3763
3839
3849
3840
3829
3764
3743
3765
3780
3795
3890
3924
3922
3904
3864
3891
3891
3820
3781
3739
3698

High(Rs)
3708
3635
0
3619
3667
3676
3736
3748
3735
3729
3761
3794
3772
3760
0
3804
3817
3788
3828
3847
3849
3840
3829
3764
3790
3775
3780
3876
3924
3942
3930
3925
3864
3894
3891
3825
3789
3739
3701

Low(Rs)
3625
3587
0
3611
3616
3601
3620
3720
3735
3682
3675
3750
3705
3723
0
3737
3761
3777
3763
3826
3849
3817
3745
3720
3725
3732
3780
3795
3890
3915
3900
3850
3864
3871
3826
3810
3722
3687
3692

)
3639
3607
3607
3615
3635
3643
3716
3730
3735
3705
3753
3781
3736
3737
3737
3782
3782
3782
3790
3838
3849
3829
3770
3730
3769
3760
3780
3857
3917
3928
3913
3882
3864
3882
3850
3818
3734
3714
3696

PCP(Rs)
3714
3639
3607
3607
3615
3635
3643
3716
3730
3735
3705
3753
3781
3736
3737
3737
3782
3782
3782
3790
3838
3849
3829
3770
3730
3769
3760
3780
3857
3917
3928
3913
3882
3864
3882
3850
3818
3734
3714

CRUDE OIL MOMENTS WITH IN THE PROJECT PERIOD

WEAK

CLOSING DATE

RATE

CHANGE OF %

1 week

2rd July

3639

2 week

10th July

3730

2.50%

3 week

17th July

3737

0.18%

4 week

24th July

3838

2..40%

5 week

30st July

3769

-1.79%

6 week

6th Aug

3913

+3.82%

7 week

14th Aug

3714

-5.00%

Figure no:8
INTERPRETATION: above data indicating weekly performance of crude oil from 4 th July 2011
to 14th August 2011. When compare to other commodity moments 2 nd and 3rd week prices
decreased and crude oil price increased, it indicates sometimes gold and silver have inverse

relation, and when you notice about last week performance of crude oil we can see fall in crude
oil.When gold prices increases, crude price decreases, this has proved in few situations, but there
is no major reason for this and its psychological thought and its proving few times, so investors
believe there is inverse relation in that.

CHAPTER 5
FINDINGS, SUGGESTIONS AND
CONCLUSION

FINDINGS

The investment in this for short period of time and most of the trading is intra-day in
nature i.e., Buy and Sell on same day to make profits. Here daily volumes and trends are
considered.

There is no scope for better and huge profits especially in commodities market for
investing when compared to investing in Equity market.

There is no physical delivery of most of the trades in case of commodities unlike other
areas of investments, supporting the large volume based market.

Investments in commodities market is less risky, the prices of commodities are more
stable than that of other instruments of capital market.

Though both Futures and Options contracts are available in world commodity market, but
in India Options have not been permitted by government.

The prices of crude oil have been dominated is U.S dollars with the fluctuation in the
value of the U.S dollars and the prominence that never currencies such as the euro are
gaining OPEC is considering switching crude oil from U.S dollars quotation system to
either the euro or to a basket of multiple currencies

China has become the worlds second largest energy consuming country after united state
of America flourishing economic like india, china , are becoming huge oil consumers.

Crude oil is safer investment than gold because of risk as to the amount of fake gold bars
circulation.

SUGGESTIONS
1.

As the fund managers take decisions with mutual fund investment, it would be another
option for him to invest through mutual funds in commodity market.

2. If Government takes this commodity market into awareness for the farmers, it would be better
for them to take their own decisions for commodity which they want to trade.
3. As there is an option for the trader to take the physical delivery, it would be better if the
Government cuts the tax rate for the physical delivery of goods.
4. Commodity market presently deals with FUTURES contract and most probably OPTIONS are
provided, it would be convenient to the investors.
5. Investing in oil is just like investing in the stock or commodities market in oil is as risky as any
other investment in real state,gold,currencies or commodities
6. Keep an eye on the worlds production is a valuable tool when dealing in oil futures
7. Watch for oil production cuts or increase from OPEC and always keep an eye on live movement
of crude prices chart for live ups and downs in the live in real.
8. Not all investors are well suited to investing in oil futures due to the very risk volatility of
market, as such, the best tip on investing in to always follow an entry and exit strategy.

CONCLUSIONS

Commodities market, contrary to the beliefs of many people has been in existence in
India through the ages. However the recent attempt by the Government to permit Multicommodity National levels exchanges has indeed given it, a shot in the arm. Commodity
includes all kinds of goods.

FCRA defines goods as every kind of movable property other than actionable claims,
money and securities. Futures trading are organized in such goods or commodities as
are permitted by the Central Government.

Firstly, the price movements are more predictable, purely based on demand and supply
of that commodity, unlike in other markets where price manipulations are very much
possible, hence the investor is fixed. To that extent market price risk is reduced.

The future contracts available on a wide spectrum of commodities like ,crude oil ,
Cotton, Steel, Soya oil, Soya beans, Wheat, Sugar, Channa etc., provide excellent
opportunities for hedging the risks of the formers ,importers, exporters, traders and large
scale consumer.

Oil is the single most important commodity that leads the position of key factors in each
and every economy of the world the worlds reaches nation are at there current position
just because of oil factor.

The commodity trading is a sophisticated form of investing it similar to stock trading but
instead of buying and selling shares of company an investor buys and sells commodities.

CHAPTER 6
BIBLIOGRAPHY

BIBILOGRAPHY

1.

Donald E. Fisher, Ronald J. Jordan, Securities Analysis and

Portfolio Management,, 1999, sixth edition, futures and options
Page no: 404-435,489,493. Prentice hall of India

2.

Sharpe W.F. Alexander J. Bailey, investments, 1998, 5th edition, Derivatives, Prentice
Hall of India,.

3.

SCHAUM"S out lines, investments,2nd edition, new chapters on future And options

WEBSITES:
www.COMEX.com
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