PROJECT PROPOSAL

ON

COMMODITY MARKET
INTRODUCTION Ever since the dawn of civilization commodities trading has become an integral part in the lives of mankind. The term commodity refers to any material, which can be bought and sold. Commodities in a markets context refer to any movable property other than actionable claims, money and securities. Over the years commodities market have been experiencing tremendous progress, which is evident from the fact that the trade in this segment is standing as the boon for the global economy today. Coming to Indian scenario, commodity markets in India are still in their initial stages of development. The reasons for this can be attributed to stringent regulatory innervations, intermediate ban on commodity trading and policy innervations by the government. Commodity markets have a huge potential in the Indian context particularly because of agriculture liberalization, commodities trading in India has gained increased momentum in activities. To increase the efficiency of the markets the forward Markets commission (FMC), the governing body of commodities trading in India, has taken several initiatives for the establishment of national level multi-commodity exchange in India. These exchanges serve as platforms for facilitating transparent trading in multiple commodities, electronic delivery systems and efficient regulatory mechanism, creating a world class environment for Indian traders. In order to sustain the increasing volumes in commodities trade, the need for proper clearing and settlement systems, warehousing facilities and efficient pricing mechanisms have been identified.

OBJECTIVES OF THE STUDY To understand the fundamentals of commodity market. To understand the need of evaluation of commodity markets in the world. To understand trading and settlement mechanism of commodities in India. The study aims at understanding the governance and regulatory frame work for commodity derivatives exchanges, traders, investors and other participants.

STRUCTURE OF PROJECT

What is commodity market? History of commodity market in India and world.

Structure and norms, regulations governing commodity market. How to invest in commodity market(process) and its advantages. Study on gold commodity market of India.

SCOPE OF THE STUDY

The study mainly focuses on Indian commodity market, its history and latest developments in the country in commodity market. The study also gives a birds eye view on global commodity market and its development. The study should help in increasing the knowledge about the commodity market in India.

LIMITATIONS OF THE STUDY Commodity markets, like any other markets, have their own limitations too. Some of them are:

Commodity market prices can fluctuate wildly depending on the factors, which are sometimes beyond human control. Forward / futures trading involve a passage of time between entering into a contract and its performance making thereby the contracts susceptible to risks, uncertainties, etc. The sources utilized for the study, which include: websites, information from commodity market trackers and economists are subject to personal biases.

REFERENCES

http://www.commodityonline.com/ http://www.mcxindia.com http://www.ncdexindia.com http://www.commoditiescontrol.com Trading commodities and financial futures: a step by step guide to mastering the market by George Kleinman. Karvy Commodities Broking Ltd.

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