MCX India (Multi Commodity Exchange of India) is the country’s first listed commodity futures market that is established in 2003 and runs trading online. It is said to be the fifth largest in the world when it comes to exchange of goods. It facilitates the commodity futures transactions as well. It helps provide a base for risk management. It provides trading in many different futures, which include non-ferrous and ferrous metals, energy, agricultural commodities like crude palm oil, cotton, cardamom and others, as well as bullions.
In neutralizing MCX risk, hedging is used as a technique wherein it takes a position in the market’s derivatives that are opposite to another in the cash market. By this, it reduces or limits the effect of risk related to unpredictable changes in price.
There are to types of risk in MCX Trading
in India. One is company-specific, in which it can be diversified away through investing in other enterprises to lessen exposure to one certain stock. The other one is market risk, which it cannot be diversified away as it emerges macroeconomic factors that directly affect all the market stocks.
To make MCX trading grow with profits, the following tips or tactics have proven to be effective:
• As MCX data is not constant and MCX is an unbalanced market, you should not be ignorant about perceiving the market statistics and trading. Be fixed with your calculated decisions during trading.
• As you might have already seen on live MCX, trading is where there is buying and selling of raw materials. So do not put all your money in just one basket because a fall in the market can lead you to lose all that money. Thus, you have to expand your investments to others as well. Place your capital in different commodities sot that a little change in the market statistics wouldn’t affect your money.
• Before doing any investment in trading, watch MCX live
to get an understanding of this market. Then, you can analyze comprehensive market strategies.