Groww Commodities Trading Launch: Basics of Commodity Markets
Why in the news
Stock broker Groww went beyond equities and mutual funds by adding commodities.
Commodity types
| Group | Examples |
|---|---|
| Metals | Gold, silver, copper, aluminium |
| Energy | Crude oil, natural gas, coal |
| Agricultural | Wheat, rice, sugar, coffee, cotton |
| Others | Rubber, spices, palm oil |
How it works
- Prices respond to global supply-demand, weather, geopolitics and currencies.
- Exchanges: MCX and NCDEX.
Exam angle
- Commodities are physical goods or their derivatives, unlike shares or mutual funds.
- Spot contracts settle at once; futures settle later.
- Trading is on standardised contracts through exchanges.