FAQ
You can start with minimum INR 10,000 for agricultural commodities trading and current price for Metal. For example current price of Gold (24K) in 40,000 for 10 gm than we need 40,000 for Gold (24K) trading.
As per government norms currently we need Active Bank Account, PAN and Aadhar ID.
Financial newspapers publish daily prices, relevant news and articles on commodities. Various magazines on agricultural, metals, energy commodities available for subscription. You also can get tips by subscribing our newsletter.
SEBI( Security Exchange Board Of India).
You can trade in Agriculture, Metal and Energy (Oil and Gas).
Yes stamp duty needed in all legal commodity contracts and in India its vary from state to state.
In commodities the margin is calculated by value at risk. Normally its between 5% to 10% and 10 of the contract value. It may vary from one commodity to other. In commodities also there is a system of initial margin and mark-to-market margin that always change and depend upon the change in price and volatility.
It is daily Profit & Loss of client’s trading account.
A depository is an organization which holds (shares, debentures, bonds, government securities, mutual fund units etc.) securities of investors in electronic form at the request of the investors through a registered depository participant. It also provides services related to transactions in securities.
Currently there are only two Depositories - National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) registered with SEBI.
A Depository Participant (DP) is an agent of the depository (NSDL/CDSL) through which it interfaces with the investor and provides depository services.
Any Public financial institutions, scheduled commercial banks, foreign banks operating in India with the approval of the Reserve Bank of India, state financial corporations, stock-brokers, clearing corporations / clearing houses, NBFCs and registrar to an issue or share transfer agent complying with the requirements prescribed by SEBI can be registered as Depository Participant (DP).
An ISIN (International Securities Identification Number) is a unique 12 digit alphanumeric identification number allotted for a security (e.g. - INE283C01018). Equity fully paid up, equity-partly paid up, equity with differential voting /dividend rights issued by the same issuer will have different ISINs.
Dematerialisation is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form.
Rematerialization is the process of converting securities held in electronic form in a Demat account back in physical certificate form.
An RTA is an agent of the issuer. RTA acts as an intermediary between the issuer and depository for providing services such as Dematerialization, Rematerialization, initial public offers (IPO) and corporate actions.
When securities of a company are held in physical form by an investor, his/ her name is recorded in the books of the company as a ‘Registered Owner’ of the securities. When physical shares are converted into electronic form, the depository becomes ‘Registered owner” in the books of the company and investor’s name is removed from books of the company.
All the benefits of the dematerialized shares are given to the actual investor since the depository holds the securities in a fiduciary capacity on behalf of the investors who have opened a Demat account with the depository. Hence, the actual investor is the “Beneficial Owner” (BO) of the securities.
No, A demat account cannot be opened directly with depository. It has to be opened only though a Depository Participant (DP) of depository.
Yes, demat account can be a opened in a single name or in joint holders’ name. There can be maximum three account holders i.e. one main holder and two joint holders.
Yes. Demat account can be opened in the name of a minor. The account will be operated by a guardian till the minor becomes major. Guardian has to be the father or in his absence mother. In absence of both, father or mother, the guardian can be appointed by court.
Yes. A demat account can be opened in the name of a trust if the trust is registered under the Public Trust Act 1860 / Societies Registration Act / Bombay Public Trust Act / Public Trust Act in force in the state. If the trust is a private or unregistered trust then a demat account shall be opened in the name of trustees as an individual account.
SEBI has mandated that nomination should be recorded for a demat account held by individuals. If nomination is not to be given then the account holder(s) should give a written and signed declaration to the effect.
Yes. An investor can open more than one account in the same name with the same DP and also with different DPs. For all the accounts, investor has to strictly comply with know your client (KYC) norms including proof of identity, proof of address requirements as stipulated by SEBI and also provide PAN number. The investor has to show the original PAN card at the time of opening of demat account.
The Derivatives are financial instruments that are basically used as risk management tools. They help anyone having an underlying risk exposure to manage their risk.
Futures Contract means a legally binding agreement to buy or sell the underlying security on a future date. Future contracts are the organized/standardized contracts in terms of quantity, quality (in case of commodities), delivery time and place for settlement on any date in future. The contract expires on a pre-specified date which is called the expiry date of the contract. On expiry, futures can be settled by delivery of the underlying asset or cash. Cash settlement enables the settlement of obligations arising out of the future/option contract in cash.
Options Contract in trading is a type of Derivatives Contract which gives Options Contract is a type of Derivatives Contract which gives the buyer/holder of the contract the right (but not the obligation) to buy/sell the underlying asset at a predetermined price within or at end of a specified period. The buyer/holder of the option purchases the right from the seller/writer for a consideration which is called ‘Premium’. The seller/writer of an option is obligated to settle the option as per the terms of the contract when the buyer/holder exercises his right. The underlying asset could include securities, an index of prices of securities etc. the buyer/holder of the contract the right (but not the obligation) to buy/sell the underlying asset at a predetermined.
Call Option: When any option contract grants the buyer the right to purchase the underlying asset from the writer or seller, it is called call option or simply 'Call'.
Put Option: When the option buyer has the right to sell the underlying asset to the writer, then it is called Put Option or 'Put'.
The strike price (or exercise price) of an option is the fixed price at which the owner of the option can buy (in the case of a call), or sell (in the case of a put), the underlying security or commodity.
In-the-money option is an option that has intrinsic value. In the case of a call, an option whose exercise price is below the current underlying share price, or in the case of a put, an option whose exercise price is above the current underlying price.
At-the-money Option is an option that has intrinsic value. In the case of a call, an option whose exercise price is below the current underlying share price, or in the case of a put, an option whose exercise price is above the current underlying price.
Out-of-the-money Option is an option that has no intrinsic value. That is an option which theoretically, it would not be worthwhile to exercise immediately e.g. a call option whose exercise price is above the current underlying share price or a put option whose exercise price is below the current underlying share price.
It is the net long and short amount of outstanding positions in a particular contract.
It is the simultaneous purchase (sale) of a call and put option in the same expiry month with the same exercise price.
It is the simultaneous purchase (sale) of a call option at one exercise price and a put option at a lower exercise price but with the same expiry date.