How different is the commodity market from share market

Market

Trading involves many facets and in India particularly the biggest trades are made in the stocks and the commodity market. If you are looking for an additional source of income that could help you put your money at right places and yield you returns that could be great to fulfill many unreachable dreams, first you should know the basics of trading. This write up puts light on these options individually and also presents a comparison between the two to make it easy for you to understand the better investment options for you.

Stock market is a platform where the selling and buying of shares takes place. Every country has its particular stock market where various firms are registered and investors’ trade on their shares. Likewise, in commodity market, just like the share, there are various units known as the cash and the future market where buying and selling of various commodities like metals, grains, etc is done. In the recent times, the inclination of people towards the commodities exchange is increasing and more people are preferring to open a commodity trading account which dedicatedly works for their trade needs.

There are arrays of similarities between the stock market and the commodity market other than the fact those trading, buying and selling entities. The Sensex and the Mcx are the exchanges for these trades in India and hold a place amongst the top exchanges in the world. To sum it up in one line, it can be said that both of these options have similar trait of working.

Talking about the differences between the two, have a lot of difference in their style of working and the kind of products they trade in as well. If you take a look at the commodity charts you would see that various rates keep on flashing therein however there is no such chart like that in case of the share market. One needs to know about the future trade option as well which is present in the commodity. Another worth assessing factor herein the duration of the investment. It is seen that considering the long term investments, people buy stocks and keep them for years. However this is not the case which commodity trading no matter if it is done the general way or the online commodity trading.

Comparison can be drawn between the stocks as well as commodity market in terms of risk involved as well. In consideration with the stock market, it can be said that if you invest in the right companies and their shares, there is absolutely nothing that could stop you from making big profits. However in case of commodities, risks are involved all the time. The terms like steady growth or steady price, etc can only be used for those grains and stocks which are commonly used. For instance, wheat, gram, etc.

There are a few misconceptions amongst the traders about the trading irrespective of it being stock or commodity or forex. Keeping all the needed knowledge about these and then investing at the right places under the guidance of right broking firms can be the best solution to yearn big money.