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This project titled “A study on comparison of online with offline trading in commodities” describes about now the clients are select the medium (online or offline) while involved in trading activity particularly in commodity market and what are the factors determine that medium and what are the things they expect from stock exchange. It is important that people need to understand the dynamic and the compulsion of the financial market. Whether it is share market or any other financial market nowadays investors goes an the sentiments of the market without actually studying in which investments is being market moreover the some investor usually does not have eldgenate knowledge about the trading types and those features. Generally when correction factor occurs in the market most of the funds will turn red and will not perform well. But there are few funds, which are consistent ever when occurs these funds will yield return on the investments made even when the market is improper.
TABLE OF CONTENTS
CHAPTER 1 1 Introduction Need and Scope of the study Objectives Industry Profile Company Profile Product Profile Research Methodology 2. 3. 4. 5. Data Analysis and Interpretation Findings Suggestions Conclusion References CONTENTS PAGE NO 1 2 2 3 6 16 21 36 50 51 52 53
LIST OF TABLES
TABLE NO. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. CONTENTS Table based on Age Table based on Sex Table based on Educational Qualification Table based on Experience Table based on Online Trading Table based on Offline Trading Table based on Commodity Trading Table based on Intraday Trading Table based on Delivery Day Commission Table based on Credit Limit Provided by The Company Table based on What they like mostly online or offline Trading Table based on Online Commodity Table based on Offline Commodity Table based on Expectation of other facilities PAGE NO 35 36 37 38 39 40 41 42 43 44 45 46 47 48.
LIST OF CHARTS
CHART NO. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. CONTENTS Chart based on Age Chart based on Sex Chart based on Educational Qualification Chart based on Experience Chart based on Online Trading Chart based on Offline Trading Chart based on Commodity Trading Chart based on Intraday Trading Chart based on Delivery Day Commission Chart based on Credit Limit Provided by The Company Chart based on What they like mostly online or offline Trading Chart based on Online Commodity Chart based on Offline Commodity Chart based on Expectation of other facilities PAGE NO 35 36 37 38 39 40 41 42 43 44 45 46 47 48.
Angel Broking has once again been awarded the prestigious ‘Major Volume Driver’ award for the second consecutive year of 2005-2006 by The Bombay Stock Exchange. This coveted title was earlier conferred upon Angel by the BSE for the year 2004-2005. About the Group. The Angel Group has emerged as one of the top 5 retail stock broking houses in India, having memberships on BSE, NSE and the two leading commodity exchanges in the country i.e. NCDEX and MCX. Angel Broking Ltd is also registered as a depository participant with CDSL. It is the only 100% retail stock broking house offering a gamut of retail centric services like Research, Investment Advisory, and Wealth Management Services, EBroking & Commodities to individual investor. The group is promoted by Mr. Dinesh Thakkar and professionally managed by a team of 1980+ direct employees. It has a nation wide network comprising 12 Regional Centres , 66 branches, 2997+ registered sub brokers and business associates and 6370+ active trading terminals which cater to the requirements of 244736+ retail clients.
NEED FOR THE STUDY
During my studies I knew something about the company, but now I have specialized in a particular department for gaining industrial knowledge about financial department for further continuation of my studies. Because all departments will not give overall up to date knowledge about industry, if we went for particular department overall functioning of department will come to know. This company is one of the leading and professionally managed stock broking firm involved in quality services and research..
OBJECTIVE OF THE STUDY
1. To know about a particular department functioning in the organization.
2. To understand about the different managerial styles used in various
kind of management. 3. To know about the workers comfort in the organization. 4. To understand about the difficulties of industry in the competitive world.
5. To gather practical knowledge in financial department.
The financial market in India is one of the oldest in the world and is considered to be the fastest growing and best among all the markets of the emerging economies. The history of Indian capital markets dates back 200 years toward the end of the 18th century when India was under the rule of the East India Company. The development of the capital market in India concentrated around Mumbai where no less than 200 to 250 securities brokers were active during the second half of the 19th century. The financial market in India today is more developed than many other sectors because it was organized long before with the securities exchanges of Mumbai, Ahmedabad and Kolkata were established as early as the 19th century. By the early 1960s the total number of securities exchanges in India rose to eight, including Mumbai, Ahmedabad and Kolkata apart from Madras, Kanpur, Delhi, Bangalore and Pune. Today there are 21 regional securities exchanges in India in addition to the centralized NSE (National Stock Exchange) and OTCEI (Over the Counter Exchange of India). However the stock markets in India remained stagnant due to stringent controls on the market economy that allowed only a handful of monopolies to dominate their respective sectors. The corporate sector wasn’t allowed into many industry segments, which were dominated by the state controlled public sector resulting in stagnation of the economy right up to the early 1990s. Thereafter when the Indian economy began ‘liberalizing’ and the controls began to be dismantled or eased out, the securities markets
witnessed a flurry of IPOs that were launched. This resulted in many new companies across different industry segments to come up with newer products and services. A remarkable feature of the growth of the Indian economy in recent years has been the role played by its securities markets in assisting and fuelling that growth with money rose within the economy. This was in marked contrast to the initial phase of growth in many of the fast growing economies of East Asia that witnessed huge doses of FDI (Foreign Direct Investment) spurring growth in their initial days of market decontrol. During this phase in India much of the organized sector has been affected by high growth as the financial markets played an all-inclusive role in sustaining financial resource mobilization. Many PSUs (Public Sector Undertakings) that decided to offload part of their equity were also helped by the wellorganized securities market in India. The launch of the NSE (National Stock Exchange) and the OTCEI (Over the Counter Exchange of India) during the mid 1990s by the government of India was meant to usher in an easier and more transparent form of trading in securities. The NSE was conceived as the market for trading in the securities of companies from the large-scale sector and the OTCEI for those from the small-scale sector. While the NSE has not just done well to grow and evolve into the virtual ‘backbone’ of capital markets in India the OTCEI struggled and is yet to show any sign of growth and development. The integration of IT into the capital market infrastructure has been particularly smooth in India due to the country’s world class IT industry. This has pushed up the operational efficiency of the Indian stock
market to global standards and as a result the country has been able to capitalize on its high growth and attract foreign capital like never before. The regulating authority for capital markets in India is the SEBI (Securities and Exchange Board of India). SEBI came into prominence in the 1990s after the capital markets experienced some turbulence. It had to take drastic measures to plug many loopholes that were exploited by certain market forces to advance their vested interests. After this initial phase of struggle SEBI has grown in strength as the regulator of India’s capital markets and as one of the country’s most important institutions.
Name of the company : Angel Broking
Address of the company : Chennai regional office, Gr.Floor ,45ttk road, Alwarpet, Chennai-600018 Phone Number Email address Website Name of directors : 044 42269000 : email@example.com : www.angeltrade.com : Mr. Dinesh Thakkar Mr. Mukesh Gandhi
Angel Broking Limited is one of the leading and professionally managed stock broking firm involved in quality services and research. Angel Broking Limited is a corporate member of The Stock Exchange, Mumbai. The membership of the company with The Stock Exchange Mumbai was originally in the name of Mukesh R. Gandhi, which was eventually turned into a corporate membership in the name of Angel Broking Limited. Angel Broking Limited is managed by Mr. Dinesh Thakkar and he is well supported by Mr. Mukesh Gandhi, a fifteen years veteran in the market.
The group is well supported by a professional and qualified research team and efficient operations and back office team, which comprises of highly dedicated and qualified individuals. Angel has an in-house, state of art research department. Angel believes in reaching out to the customer at the farthest end rather than by reaching out to them. The company in its endeavour to give its client the best has opened up several branches all over Mumbai, which are efficiently integrated with the Head Office. Angel Broking Limited is primarily into retail stock broking, with a customer base of retail investors, which has been increasing at a compounded growth rate of 100% every year. The company has huge network sub-brokers in Mumbai and other places outside Mumbai, registered with SEBI, who act as chanel partners for the company. The company presently has a total staff strength of around 150 employees who are spread accordingly across the head office and all the branches. Angel has empowered its physical presence throughout India through various strategies which it has been adopting efficiently and effectively over a period of time, like opening up of branches at various places, tie-ups with various agencies and sales agents, buy-outs of smaller regional outfits and appointment of sub-brokers and franchisees
To Provide Best Value For Money To Investors Through Innovative Products, Trading / Investment Strategies, State-of-the-art Technology And Personalized Service.
Our Business Philosophy
Ethical practices & transparency in all our dealings Customer interest above our own Always deliver what we promise Effective cost management
Our Quality Assurance Policy
We are committed to being the leader In providing World Class Product & Services
Which exceed the expectations of our customers Achieved by teamwork and A process of continuous improvement
Our CRM Policy
A Customer is the most Important Visitor On Our Premises He is not Dependent on us but We are dependant on him He is not interruption in our work, But is the Purpose of it We are not doing him a favor by serving He is doing us a favor by giving us an
Opportunity to do so
Angel Broking Ltd.- BSE-612, INB010996539, UIN 100002972 Angel Capital & Debt Market Ltd. - NSE-12798, Cash - INB231279838, F&O - INF231279838 UIN 100002964 Angel Commodities Broking Pvt. Ltd.- MCX-12685, MCX/TCM/CORP/0037 | NCDEX-00220, NCDEX/TCM/CORP/0302, UIN 10059063
Angel Securities Ltd. - Cash INB010994639, F&O INF010994639, UIN 100002956
E-BROKING Welcome to the World of E-Broking
Multiple exchanges on a single screen Intra-day calls and flash news Historical charts with technical tools Streaming quotes 24x7 web enabled back – office Auto pay-in of shares Online transfer of funds Our e-broking facility is one such effort, which gives you access to stateof-the-art trading platform with multiple exchanges, order and trade confirmations, research reports, e-contracts and a 24x7 on-line web enabled centralized back-office system at the click of a button.
E-BROKING: Multiple exchanges on single screen Intra-day calls & flash news Historical charts with technical tools
RESEARCH: Daily services
Technical services Fundamental services.
INVESTMENT ADVISORY SERVICES: Angel offers personalized advisory services to HNI investors and actively assists them in managing their portfolio... COMMODITIES: State-of-the-art internet trading platform Trading & educational seminar Efficient risk management DEMAT SERVICES: Hassle free automated pay-in Wide branch coverage Centralized billing & accounting VALUE ADDED BACK OFFICE SERVICES: Web enabled centralized back-office Centralized help desk services E-contract notes cum bills.
About Angel Group
Angel group is engaged in various activities such as trading / advisory services in Indian capital markets viz., equity, futures and options etc. and also in Indian commodities markets viz., commodities futures.
About Angel Commodities
ANGEL COMMODITIES BROKING (P) LIMITED promoted by ANGEL GROUP, started its operations in Indian commodities market by acquiring memberships in India's premier multi-commodity exchanges of NCDEX (Membership No:00220) and MCX (Membership No: 12685). ANGEL COMMODITIES offers trading opportunities in commodity markets through the chain of its branches spread across the country. ANGEL COMMODITIES provides expert research / analysis to its clients in various commodities, listed in NCDEX and MCX including the international perspective of the commodities traded. It provides best technical analysis from desk of its trained and qualified analysts. The research team of angel commodities consists of professionals who are industry veterans. The team is capable of formulating trading strategies depending on risk-return profile of the client. Today we offer a gamut of financial products to satisfy an array of financial needs.
Why trade with Angel Commodities?
We have the following application and services to provide you best trading opportunities available in the industry.
• • • • • • • • •
Online application based trading software Online web based trading platform Online daily, weekly and monthly research Transparent and fair trade execution Individual client attention 24*7 online back office Training/education facilities / conduct of seminars State-of-the-art technology Digital contract notes cum bill: View your accounts from any where, any time
Efficient risk management Competitive brokerage rates
Salient features of angel trade :
Multiple exchanges on a single screen: Online trading on BSE / NSE (Cash and F&O), MCX and NCDEX on a single screen.
Speed: We use the latest technology to generate efficient uptime and greater stability to give you high speed.
Competitive brokerage rates: We believe in providing our clients the best value added services at the most competitive brokerage rates.
Optimum margins: Angel gives you the trading exposure at
optimum margin level
Online funds transfer: The clients enjoy the convenience of online transfer of funds from their bank accounts, to the margin account of Angel, online.
Personalized service: HNI clients can avail of personalized advisory services from our trained and experienced dealers, regarding trading opportunities.
Off line services: You are free to make a telephone call to any of our 71 well equipped branches across the country.
Technology: Angel provides the latest infrastructure tools to support and integrate the backend and front office functionalities.
Back office infrastructure: We provide an automated web enabled centralized back-office whereby the clients can have access to their trade confirmation reports, holding statement, their net position, the margins and the statement of accounts and ledgers on a 24 X 7 basis.
Technical support: We remove technical difficulties through an online support system managed by qualified professionals.
E - Contract notes cum bills: We provide contract notes cum bills in electronic form resulting in ease of access to trades carried out by the clients on any particular day.
Commodity market Commodities are more than what you think they are. Almost everything you see around is made of what market considers commodity. A commodity could be an article, a product or material that is bought and sold. It could be any kind of movable property, except actionable claims, money and securities. Commodity trade forms the backbone of world economy. The Indian commodity market is estimated to be around Rs. 11 million, and forms almost 50 percent of the Indian GDP. This market constitutes Agri and Non Agricultural Products. Agricultural commodities are those like rice, wheat, groundnut, tea, coffee, jute, rubber, spices and cotton,Vegetable Oils etc.,while Non Agricultural Commodities can be classified as Precious metals such gold and silver, base metals like iron and aluminum,tin,nickel etc., and energy commodities such as crude oil and coal. So what do the commodity brokers actually do? They simply facilitate the business of buyers and sellers, for a legalized rate of commission.
• • • •
Castor Seed Copra Cotton Seed Cumin Seed (Jeera)
• • • • • • • • •
Groundnut Linseed Rape/Mustard Seed Rape Seed-42 Safflower Sesame Seed Soybean Sunflower seed Yellow Soybean Meal
• • • • • • • • • • •
Castor Oil Coconut Oil Cotton Seed Oil Groundnut Oil Linseed Oil Rape/Mustard Seed Oil Safflower seed Oil Sesame seed Oil Soybean Oil Sunflower seed Oil Crude Palm Oil
• • •
RBD Palmolein Rice bran Oil Vanaspati
• • • • • • • • • •
Castor Oilcake 7Coconut Oilcake Cotton Seed Oilcake Groundnut Oilcake Linseed Oilcake Rape/Mustard Seed Oilcake Safflower seed Oilcake Sesame Oilcake Soybean Oilcake Sunflower seed Oilcake
• • • • • • • • • • •
Aluminum Copper Gold (100 Gms) Kilo Gold Lead Nickel Silver Steel Flat Steel Long Tin Zinc
• • • •
Pepper Cardamom Turmeric Red Chilli
• • •
Gram Tur/Arhar Urad
• • •
Moong Masoor Yellow Peas
• • • • • • • • • • • • • •
Rubber Sacking Sugar Gur Guarseed Guarseed Bandani Wheat Rice Raw Jute Kapas Medium Staple Cotton Long Staple Cotton Cashew Kernel Maize
Research Research refers to a critical, careful and exhaustive investigation or inquiry or experimentation having has its aim the revision of accepted conclusions, in the light of newly discovered facts. Redman and mory has explained research as “systematizied effort to gain knowledge” Research methodology Research methodology is a way to systematically solve the research problem. It is necessary to know the methodology of the research. The present study depends upon primary and secondary data collected from public in Salem city. Population Population refers to the total of items about which information is desired. The population of universe can be finite or infinite. The population is said to be finite if it consist of a fixed number of elements so that it is possible to enumerate it in it totality. An infinite population is that population in which it is theoretically impossible to observe all the elements. We can’t have any idea about the total. Sample size From the portion of total population I have selected 100 respontent for doing the research.
Collection of time There are two processes in collecting data. They are primary and secondary data, which I have used for collecting the data, is both primary and secondary data. Primary data In primary data the interview schedule is used to collect the information from the employees in the organization Secondary data Secondary data is used to collect information from the internet and also from the past records. Data analysis The collected data from the respondents was analyzed with the help of simple percentage method. What is commodity? Commodity markets are those markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities exchanges in which they are bought and sold in standardized Contracts. This is called commodity trading. For a commodity market to be established there must be broad consensus on the variations in the product that make it acceptable for one purpose or another. Generally, Governments must provide a common regulatory or insurance standard and some release of liability, or at least a backing of the
insurers, before a commodity market can begin trading. Unless the product or service can be guaranteed or insured to be free of liability based on where it came from and how it got to market it becomes impossible for sellers to guarantee a uniform delivery. Indian commodities exchange Commodity trading is increasingly becoming a prominent business in India. To facilitate this trading there are various exchanges setup in India. These exchanges are the hub of the trading of various commodities. The primary Indian commodity exchange is the Multi Commodity Exchange of India (MCX). The other very prominent commodity exchange is National Commodities and Derivatives Exchange Limited. NCDEX is located in Mumbai and offers facilities in more than 550 centers in India. MCX features amongst the world's top three bullion exchanges and top four energy exchanges. MCX is the only Exchange in India to have such investment and technical support from the commodity relevant institutions. The day-to-day operations of the Exchange are managed by the experienced and qualified professionals with impeccable integrity and expertise.
MCX INDIA Organized commodity trading is one of the latest money earning vehicles in India. MCX (ISO 9001:2000) is an independent and de-mutualised multi commodity exchange. Inaugurated on November 10, 2003, MCX has permanent recognition from the Government of India for facilitating online trading, clearing and settlement operations for commodity futures markets across the country. Today, MCX features amongst the world's top three bullion exchanges and top four energy exchanges. The average daily turnover of MCX is approximately USD 1.52 billion (INR 7, 000 Crore for the Apr – Jun 2006 quarter) with a record peak daily turnover of USD 3.98 billion (INR 17,987 Crore) on April 20,2006. In the second calendar quarter of 2006, MCX holds more than 55% market share of the total trading volume of all the domestic commodity exchanges. The exchange has also affected large deliveries in domestic commodities, signifying the efficiency of price discovery. NCDEX INDIA India is fast progressing in the area of commodity and derivatives trading under the aegis of the National Commodity and Derivatives Exchange Limited. NCDEX is a closely held private limited company incorporated on April23, 2003, under the Companies Act 1956.It obtained its Certificate for Commencement of Business on May9, 2003. It has commenced its
operations on December15, 2003. NCDEX has an independent Board of Directors and professionals not having vested interest in commodity markets. NCDEX is regulated by Forward Market Commission (FMC) in respect of futures trading in commodities. Besides, NCDEX is subjected to various laws of the land like the Companies Act, Stamp Act, Contracts Act, Forward Commission (Regulation) Act and various other legislations, which impinge on its working. On February3rd, 2006, the FMC found NCDEX guilty of violating settlement price norms and ordered the exchange to fire one of their executive. NCDEX is located in Mumbai and offers facilities in more than 550 centers in India. Commodity option trading system The commodity options trading system basically consists of a market in which producers may purchase the opportunity to sell or buy a commodity at a certain price. This is similar to a situation where a farmer may purchase the right from an insurance firm to collect on a policy in case his buildings burn, he can purchase the right to sell his commodities at a specific price if market prices go below the specified price. In fact a separate market exists where purchase of the right to buy commodities at a specified price of market prices are higher than the specified price. Therefore, effectively there are really two separate commodity options trading systems - one where it is possible to insure products being sold against price declines, and another where it is possible
to insure products purchased against price increases. People who participate in the commodity options trading systems have the opportunity but not the obligation to exercise their agreement. This is the reason that the system is appropriately named the option trading system since they deal in an option, not an obligation. To explain this concept further, for instance, if a person desires to buy the right to sell a given commodity for a certain price, the commodity options market provides the opportunity. By paying the market-determined premium, the person could then collect on the option if prices are below the price at which the deal was finalized when the corn would actually be sold. If prices are higher than the price at which the deal was finalized, the commodity could be sold for the higher price and the cost of the premium is absorbed. As mentioned, there are actually two basic types of commodity option trading systems: a call option and a put option. The call option gives the holder the right, but not the obligation, to buy the underlying commodity from the option writer at a specified price on or before the option's expiration date. On the other hand, the put option gives the holder the right, but not the obligation, to sell the underlying commodity to the option writer at a specified price on or before the option's expiration date. The call option and the put option are two distinct contracts.
Commodity futures trading commission The mission of the Commodity Futures Trading Commission is primarily to protect the market users and the public from malpractices such as fraud, manipulation, and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets. The Congress created the Commodity Futures Trading Commission in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States. The basic mandate taken up by the agency was to renew and expand since then. Today, the Commodity Futures Trading Commission regulates the economic utility of the futures markets by encouraging their competitiveness and efficiency, ensuring their integrity, protecting market participants against manipulation, abusive trading practices, and fraud, and ensuring the financial integrity of the clearing process. It is through effective oversight, that the Commodity Futures Trading Commission enables the futures markets to serve the important function of providing a means for price discovery and offsetting price risk. The CFTC monitors markets and market participants closely by maintaining, in addition to its headquarters office in Washington, offices in cities that have futures exchanges-New York, Chicago, Kansas City, and Minneapolis. Benchmarked against the functions and responsibilities assumed by the Commodity Futures Trading Commission in the United States, The Forward Markets Commission (FMC) was set up as the regulatory body for
Commodity Trading in futures/forward trade in India. Similar to the function of the CFTC, The Forward Markets Commission is responsible for regulating and promoting futures trade in commodities in India. The FMC has its headquarters in Mumbai and the regional office is located in Kolkata. There are some 21 commodity exchanges in India. But most of these commodity exchanges are regional, offline and commodity specific. The government has recently allowed four national level multi-commodity exchanges to trade in all permitted commodities Commodity trading advisors Commodity Trading Advisors usually use proprietary trading programs that buy and sell commodities and financial futures around the globe and specifically in India to seize profit opportunities in a variety of markets. The set of Commodity Trading Advisors in India are an increasingly popular and potentially profitable investment alternative for institutional investors and high-net-worth individuals and are an emerging option especially in India. The Chartered Alternative Investment Analyst SM programme is the industry's global professional standard that covers commodities and managed futures since its inception. The hedge funds have so far captured most of the media and publishers' attention and little has been done to provide investors with a comprehensive review of the fast growing Commodity Trading Advisors. The Commodity Trading Advisors usually investigate the many benefits and risks examining the risk/return characteristics of a number of different
strategies. There are many issues related to Commodity Trading Advisors investment, fees and regulations. Much of the information relating to Trading Advisors can be technical in nature. When they look for portfolio diversification, they investigate futures programs. Unlike other asset classes, where profits depend solely on price appreciation, opportunities in futures exist in both rising and falling markets, in areas all around the world in at least 50 different futures markets. You need to find a Commodity Trading Advisors program that suits your financial objectives and risk parameters. It would be necessary to monitor many managed programs, and have good working relationships with the commodity trading advisors whose programs are top performers. Online commodity trading Online commodity trading offers a way for an open, many-to-many system, where every user has equal access to price quotes and trading functionality. It provides a level playing field for all, without favoritism or control by a chosen few, where any user can view all quotes posted by other users in real time, act or trade on quotes posted by others, post their own prices and quantities for others to trade. The Online commodity trading site usually lists a large number of unique products covering a variety of commodities, structures, and settlement terms ranging from Oil, Natural Gas, Electric Power, Precious Metals, Emissions and Weather.
It provides for various media ranging from Physical Delivery and Financial Cash Settlement. There are further derivative options available ranging from Forwards, Swaps, Options, Spreads, Differentials, Complex Derivatives. Liquidity, or trade activity, is perhaps the best measure of success of an online trading commodity trading system. With most online commodity trading systems, traders can be sure of finding an interesting market development or trading opportunity almost every time they log on. All quotes posted by users on any online commodity trading systems are live and firm. They can be acted on with full assurance of a completed transaction. The greatest advantage of an online system for trading is that just a click can be used to hit a bid or lift an offer. The Online trading system operates almost continuously around the clock, 24 hours a day, seven days a week. This allows any user to extend the trading day, and easily pass the trading objectives to others in companies in different time’s zones. The online commodity trading system in India is only an emerging segment yet. This is because the Internet boom in Indian is on the rise only now. The Internet charges are becoming minimal and the Internet is soon becoming a way of life in India. It is in this scenario that online trading is becoming more the way of trading in India.
OFFLINE COMMODITY Commodities are more than what you think they are. Almost everything you see around is made of what market considers commodity. A commodity could be an article, a product or material that is bought and sold. It could be any kind of movable property, except actionable claims, money and securities. Commodity trade forms the backbone of world economy. Offline commodity trading means apart from online commodity trading, goods or things involved in buying and selling activity, those are all the activities considered as offline commodity trading. For example retail marketing, vegetable markets, jewel shops and so on. Now a days banking sectors also involved in offline commodity trading. They involved selling and buying gold from customers.
A guide for Indian Entrepreneurs to understand the business of commodity trading The concept of Commodity Trading is not new in India. Commodity Trading was very much existent in earlier times in India. In fact it was one the most vibrant forms of markets till the early 70s. However due to numerous restrictions the Commodity Trading market could not develop further. Recently most of these restrictions have been removed, and therefore this allows for the development and growth of the commodity market in India. The usefulness of Commodity Trading in futures is that it results in transparent and fair price discovery on account of large-scale participations
of entities associated with different value chains. It also reflects views and expectations of a wider section of people who may be related to a particular commodity. Commodity Trading in futures also provides an effective platform for price risk management to all the segments of players who participate in the Commodity Trading ranging from producers, traders and processors to Exporters/importers and end-users of a commodity. Commodity Trading also provides hedging, trading and arbitrage opportunities to market players. The Forward Markets Commission (FMC) is the regulatory body for Commodity Trading in futures/forward trade in India. The Forward Markets Commission is responsible for regulating and promoting futures trade in commodities. The FMC has its headquarters in Mumbai and the regional office is located in Kolkata. There are some 21 commodity exchanges in India. But most of these commodity exchanges are regional, offline and commodity specific. Difference between online and offline stock trading? The introduction of the Internet has surprisingly changed our way of life as a society. It has defined the way we do business and the way we correspond. The Internet has opened many opportunities for online trading.
The financial industry revolves around the Internet. Every thing is just a few clicks away. This makes online trading most convenient. But there are still investors who prefer the old fashion way of offline trading and they mainly prefer offline trading for security reasons. Internet has introduced a way for consumers to manage their money online. Not to mention, Internet has transformed the way investment companies operate their business and has made it easy for private investors to gain straight access to a range of different markets and online tools that were at one point only reserved by the use of investment professionals. Consumer investing and online trading has dramatically changed over the last decade. Online trading dynamically continues to be redefined. Services have expanded to include integrated management of additional financial accounts. Not to mention, it has subsequently expanded in conjunction with ground-breaking improvements to the traditional trading interface, such as telephone interface systems. Of course, online trading has many advantages. There are several wonderful reasons to invest online and consider online trading. 1. Money saving opportunities The amount of money you save depends primarily on the online brokerage firm that you choose. No two firms are the same. There may be different regulations, similar to bank regulations. There are minimum deposits required that must be maintained. As mentioned above, this will depend on the online brokerage firm.
2. Instant online access You can gain instant access to your account, the value of your portfolio updates immediately before your eyes. 3. Enter online trades at anytime You can enter online trades at anytime and from anywhere. This is very convenient if you live in a different time zone than the country you are trading in. Not to mention, it is especially fit for investors with busy schedules. 4. With online trading you are in charge You are in control of your investments. No sales pitches and no hassle. You decide where to invest your money. Nevertheless, with all the convenience of online trading there are still investors who prefer the old fashion way of offline trading.
Offline trading has lost some popularity but it is still the
main form of investing. Offline trading offers many benefits as well. 1. The one benefit that an investor appreciates the most is that they are not alone when making investment decisions. 2. There are experienced and professional brokerage companies that handle their investments for them. 3. Investors are not faced with the challenge of making these vital investment decisions; especially, if they do not have the experience investments. necessary to make the appropriate
Also, there is someone there to answer any questions that may cause concerns.
Not to mention, with offline trading mistakes are less likely to take place. No one wants to throw their money away or stand by and watch someone else throw their money away. It may be wise to hire a professional to assist you in making the correct investment decisions if you feel you lack the knowledge necessary.
2. DATA ANALYSIS AND INTERPRETATION
TABLE – 1 CLASSIFICATION OF THE RESPONDENTS BASED ON AGE Age Below 20 21 - 30years 31 - 40years Above 40years Total INFERENCE: The above table shows that 6% of the respondents are below 20yerars. 34% of the respondents are between the age group of 21-30years. 22% of the respondents are between the age group of 31-40years and 38% of the respondents are above 40years. No. Of Respondents 6 34 22 38 100 Percentage 6 34 22 38 100
Chart - 1 Classification of the Respondents based on Age
40 35 30 25 20 15 10 5 0 Below 20 21 - 30years Age 39 31 - 40years Above 40years 6 22 38 34
TABLE - 2 CLASSSIFICATION OF THE RESPONDENTS BASED ON SEX Sex Male Female Total No. Of Respondents 89 11 100 Percentage 89 11 100
INFERENCE: The above table shows that 89% of the respondents are males and 11% of the respondents are female. Most of the respondents (89%) are males.
90 80 70 60 50 40 30 20 10 0 Male Female
No. Of Respondents Percentage No. Of Respondents
TABLE – 3 CLASSIFICATION OF THE RESPONDENTS BASED ON EDUCATIONAL QUALIFICATION Educational status School level ITI Degree Diploma Total INFERENCE: The above table shows that 56% of the respondents having school level of education and 24% of the respondent finished their Degree courses. CHART-3
No. Of Respondents based on educational qualification
No. Of Respondents 56 20 24 0 100
Percentage 56 20 24 0 100
School level ITI Degree Diploma
TABLE – 4 CLASSIFICAATION OF THE RESPONDENTS BASED ON EXPERIENCE Experience in years Below 1year 1 - 5year 6 -10year Above 10year Total INFERENCE: The above table shows that 42% of the respondents are having below one-year experience. 29% of the respondents are having 1-5years of experience. 9% of the respondents are having 6-10years experiences and 20%of the respondents having experience above 10years. CHART-4 No. Of Respondents 42 29 9 20 100 Percentage 42 29 9 20 100
50 40 30 20 10 0 Below 16Above 1year 5year 10year 10year No. Of Respondents No. Of Respondents Percentage
TABLE – 5 CLASSIFICATION OF THE RESPONDENTS BASED ON ONLINE TRADING Online Trading Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 73% of the respondents are fully satisfied with the online trading provided by the organization and 27% of the respondents are satisfied with the online trading provided by the organization.
No. Of Respondents 73 27 0 100
Percentage 73 27 0 100
Percentage Fully Satisfied Satisfied Not Satisfied No. Of Respondents
TABLE – 6 CLASSIFICATION OF THE RESPONDENTS BASED ON OFFLINE TRADING Offline Trading Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 34% of the respondents are fully satisfied with the ventilation facility provided by the organization and 66% of the respondents are satisfied with the ventilation facility provided by the organization. No. Of Respondents 34 66 0 100 Percentage 34 66 0 100
Fully Satisfied Satisfied Not Satisfied
TABLE-7 CLASSIFICATION OF THE RESPONDENTS BASED ON COMMODITY TRADING Commodity Trading Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 38% of the respondents are fully satisfied with the Commodity Trading and 62% of the respondents are satisfied with the floor cleaning. No. Of Respondents 38 62 0 100 Percentage 38 62 0 100
RESPONDENTS BASED ON COMMODITY TRADING
Not Satisfied No. Of Respondents Percentage Fully Satisfied 0 50 100 150
TABLE – 8 CLASSIFICATION OF THE RESPONDENTS BASED ON INTRADAY COMMISSION
Intra Day Commission Fully Satisfied Satisfied Not Satisfied Total INFERENCE:
No. Of Respondents 81 19 0 100
Percentage 81 19 0 100
The above table shows that 81% of the respondents are fully satisfied with the Intra day commission charged by the organization and 19% of the respondents are satisfied Intra day commission charged with the by the organization. CHART-8
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Fully Satisfied Satisfied Not Satisfied Percentage No. Of Respondents
TABLE – 9 CLASSIFICATION OF THE RESPONDENTS BASED ON DELIVERY DAY COMMISSION
Delivery Day Com mission Fully Satisfied Satisfied Not Satisfied Total INFERENCE:
No. Of Respondents Percentage 25 63 12 100 25 63 12 100
The above table shows that 25% of the respondents are fully satisfied with the Delivery day commission. 63% of the respondents are satisfied with the Delivery day commission and 12% of the respondents are not satisfied with the Delivery day commission.
chart - 9
70 60 Percentage 50 40 30 20 10 0 Fully Satisfied Satisfied DELIVERY DAY COMMISSION Not Satisfied 25 12 63
TABLE – 10 CLASSIFICATION OF THE RESPONDENTS BASED ON CREDIT LIMIT PROVIDED BY THE COMPANY Credit Limit Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 73% of the respondents are fully satisfied with the Services provided by the broking company and 27% of the respondents are satisfied with the Services provided by the broking company. CHART-10 No. Of Respondents 73 27 0 100 Percentage 73 27 0 100
CLASSIFICATION OF THE RESPONDENTS BASED ON CREDIT LIMIT
No. Of Respondents Percentage
TABLE - 11 CLASSIFICATION OF THE RESPONDENTS BASED ON WHAT THEY LIKE MOST WHETHER ONLINE OR OFFLINE TRADING Most Like Online Trading Offline Trading Not Interested Total INFERENCE: The above table shows that 76% of the respondents are fully interested to do the online trading. 24% of the respondents are interested in offline trading. CHART-11
No. Of Respondents 76 24 0 100
Percentage 76 24 0 100
No. Of Respondents Percentage
TABLE - 12 CLASSIFICATION OF THE RESPONDENTS BASED ON ONLINE COMMODITY Online Commodity Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 64% of the respondents are fully satisfied with the online commodity and 36% of the respondents are satisfied with the online commodity. CHART-12
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Fully Satisfied Satisfied Not Satisfied Percentage No. Of Respondents
No. Of Respondents 64 36 0 100
Percentage 64 36 0 100
TABLE - 13 CLASSIFICATION OF THE RESPONDENTS BASED ON OFFLINE COMMODITY Offline Commodity Fully Satisfied Satisfied Not Satisfied Total INFERENCE: The above table shows that 24% of the respondents are fully satisfied with the offline commodity and 76% of the respondents are satisfied with the offline commodity. CHART-13
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Percentage No. Of Respondents Fully Satisfied 24 24 Satisfied 76 76 Not Satisfied 0 0
No. Of Respondents 24 76 0 100
Percentage 24 76 0 100
TABLE-14 CLASSIFICATION OF THE RESPONDENTS BASED ON EXPECTATIONS OF OTHER FACILITTIES.
Expectation Of Other Facilities Fully Satisfied Satisfied Not Satisfied Total
No. Of Respondents 17 83 0 100
Percentage 17 83 0 100
The above table shows that 17% of the respondents are expecting some other facilities from management and 83%of the respondents are not expecting any other facilities.
CLASSIFICATION OF THE RESPONDENTS BASED ON EXPECTATIONS AND OTHER FACILITIES 100 80 60 40 20 0 Fully Satisfied Satisfied Not Satisfied Percentage No. Of Respondents
No. Of Respondents Percentage
FINDINGS OF THE STUDY
84% of the respondents are males. 73% of the respondents are highly satisfied with online trading. 65% of the respondents are not satisfied with offline trading. 71 of the respondent are satisfied with in trading day commission.
30% of the respondent is highly satisfied regarding credit limit allowed by the company. 27% of the respondents are highly satisfied with risk and return.
Even though, online trading is better than offline trading. Still it is difficult for the traders to trade. Many of our farmers tack in educational, therefore tack of knowledge of market and exchanges. So there is a need to educate them in order to participating in these markets to take the advantages of hedging again their agricultural products. Online trading do away from the more of intermediaries which is farmer and must benefit to farmers. Many company’s yet in to retail trading in big way. Volume of trading is yet to be positive and which would pay way to better price discovery mechanisms. Online trading links farmers to consumers therefore resultors in better realizations . Offline line trading exeses customers to risk of credit defaults delay in payments, and also delay of commodity dermises.
TO my understanding the best of my knowledge with the help of my study at “ANGEL BROKING”, there by conclude my study saying that online trading is better in many terms than offline trading and will flourish in the future.
www.commodity trading.com. www.nseindia.comm. www.money control.com.
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