Commodities Newbie Here

#1
Please help me to clear certain basics regarding the commodity segment as I am an absolute noob here.

Today copper(28 June expiry) and Crude Oil (19 June expiry) opened at 408.25/- and 5651/- at the MCX (Indian exchange) respectively.

1. Are these the futures or options of copper and crude oil ?

2. How much money is needed for buying and selling of 1 contract of each of them? (Also, please specify their lot sizes).

3. Why do they have different expiry dates?
 

ashu1234

Well-Known Member
#2
Hi,
Please go to the site mcxindia.com, there in the products section you'll get complete information about all the contracts. All here are futures only contract and their expiry are based on international exchange i.e comex.
 
#3
Please help me to clear certain basics regarding the commodity segment as I am an absolute noob here.

Today copper(28 June expiry) and Crude Oil (19 June expiry) opened at 408.25/- and 5651/- at the MCX (Indian exchange) respectively.

1. Are these the futures or options of copper and crude oil ?

2. How much money is needed for buying and selling of 1 contract of each of them? (Also, please specify their lot sizes).

3. Why do they have different expiry dates?
Additionally, Please tell me the following :

1.what is meant by CopperM?.Is it a mini contract of copper ? Like we used to have Minifty earlier?

2. Just for the sake of verification whether I have understood about margins correctly, please go thru the attached file and tell me whether the margin required to buy 1 lot :-
a) Crude Oil is 28315 AND
b) Copper is 20397.5 ?

3. I cannot figure out what will be the margins required to sell the same contracts? Please help..

Thanks in advance
 
Last edited:

Taiki

Well-Known Member
#4
Please help me to clear certain basics regarding the commodity segment as I am an absolute noob here.

Today copper(28 June expiry) and Crude Oil (19 June expiry) opened at 408.25/- and 5651/- at the MCX (Indian exchange) respectively.

1. Are these the futures or options of copper and crude oil ?

2. How much money is needed for buying and selling of 1 contract of each of them? (Also, please specify their lot sizes).

3. Why do they have different expiry dates?
Thanks Sangita,

I am also complete new in the world of commodity. I had tried to explore this before (1 month ago), but for some reason, i did not find time, and had to focus only on NSE derivatives. But now have started again on studying and analysing commodity contracts.

Thank you for the thread, will be visitng this often. :thumb:

Good luck and Regards
Taiki
 

ashu1234

Well-Known Member
#5
Hi,
Simple way to understand is margin for most of the contract traded are around 5%. So Crude is trading @ CMP 5685 and its lot size is 100, so total value of contract is 568500, so at 5% margin it comes to 28425 Rs. Margin required to buy or sell is same at 5%, some contract.
Yes copper mini is like mini nifty.

See the lot size here http://wealthtracker.16anna.com/span/MCX DAILY MARGIN.pdf, so every one rupee increase will give you the profit in the multiple of lot size. So Copper having a lot size of 1000 give you Rs 1000 as profit/loss on every one rupee movement and copper mini will give you 250 rs on every one rupee movement. So you can do the sum for other commodities too.

Hope it helps.
 
#6
Hi,
Simple way to understand is margin for most of the contract traded are around 5%. So Crude is trading @ CMP 5685 and its lot size is 100, so total value of contract is 568500, so at 5% margin it comes to 28425 Rs. Margin required to buy or sell is same at 5%, some contract.
Yes copper mini is like mini nifty.

See the lot size here http://wealthtracker.16anna.com/span/MCX DAILY MARGIN.pdf, so every one rupee increase will give you the profit in the multiple of lot size. So Copper having a lot size of 1000 give you Rs 1000 as profit/loss on every one rupee movement and copper mini will give you 250 rs on every one rupee movement. So you can do the sum for other commodities too.

Hope it helps.
Here comes 2 more noob questions:-

1.Can we do delivery trades BOTH on Commodities as well as Currency(CDS) segments?

2.If yes, can we do both long and short delivery trades for both of these segments?
 

ashu1234

Well-Known Member
#7
Here comes 2 more noob questions:-

1.Can we do delivery trades BOTH on Commodities as well as Currency(CDS) segments?

2.If yes, can we do both long and short delivery trades for both of these segments?
By delivery do you mean overnight carrying of position -- then Yes. So you can do both short and long trades and above margin you have to pay normal m2m just like nifty futures.

If you mean taking physical delivery - then Yes and No, as some commodities are settled in cash only.
 

ashu1234

Well-Known Member
#10
Commodities do have Index, but they are not meant for trading.

So first you must have a fair idea of the major groups traded on MCX.

Base Metals: Lead, Zinc, Aluminum, Copper, Nickel.
Energy: Crude Oil, Natural Gas.
Bullion: Gold, Silver.

My criteria to trade is liquidity and swings/trend. So my personal favorites are Gold, crude and n.g and lead. Good thing to be on MCX is that you can actually connect fundamentals more comfortably and with ease in comparison to stocks. Technicals work great here(liquidity being the major factor), and trend in commodities are cyclical so its a best place to make money if you have experience and money to exploit that cycle.
 

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