Perception Of Consumer Regarding Commodity Market

Introduction :IIFL
IIFL :INDIA INFOLINE LTD
IIFL provide full range of Financial services In Equity ,Derivatives, Commodity and currency. IIFL has Received an approval For Security trading clearing membership from SINGAPORE EXCHANGE and also from COLOMBO STOCK EXCHANGE. IIFL is best brand among India domestic broking house. Network of 596 branches spread over more then 345 cities and town , and have a customer network of more then 500000. Have Personalized service and cutting edge Technology.

AWARD Got BEST BROKER OF THE INDIA AWARD in 2008 by FINANCE ASIA Most Improved Brokerage by ASIA MONEY POLL.

Vision & Mission: Vision is to be most reputed company of the FINANCIAL SERVICE SPACE. Mission is to become full fledged financial service company known for its quality of advice, Personalized service .

KEY MANAGEMENT
Mr.R VENKATARAMAN is Co Promoter and Managing director Of India Info line LTD.

Mr. NIRMAL JAIN Founder and CHAIRMAN Of India Info line LTD.

Mr. Nilesh Vikamsey Independent Director

Mr. Kranti Sinha Independent Director

Mr. A.K.Purwar Independent Director

BUSINESS STRUCTURE

INDIA INFOLINE MEDIA&RESEARCH Services Ltd. INDIA INFOLINE COMMODITIES Ltd.

INDIA INFOLINE MARKETING & SERVICES

INDIA INFOLINE (ASIA)PVT LTD.

COMMODITIES

Any good exchanged during commerce, which includes goods traded on a commodity exchange. A commodity is food, metal, or another fixed physical substance

that investors buy or sell.

A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services.
Why Trade in Commodities?

1. 2. 3.

Big Market Diverse Population Huge Potential Portfolio Diversifier

Types OF Commodity Exchange

MULTI COMMODITY EXCHANGE (MCX) Headquarter: MUMBAI Establishment :2003 Turnover (2011):US$ 1.24 Trillion Mainly trade in :Bullions,

Metals, Energy

NATIONAL

COMMODITY

AND

DERIVATIVE

EXCHANGE(NCDEX)

Headquarter: MUMBAI
Established: APRIL23, 2003 Mainly Trade in : AGRO PRODUCTS

Research Methodology
Need of the study: Commodity market provides a good source of investment,
where investors do not come forward to invest due to lack of proper information.

Hence there arises a need of study in commodity market. This study gives us Idea
About Why people are not Investing In commodity Market. Many of the investor want to invest in commodity market but due to high volatility and high fluctuations they are not ready to go for big investment.

Objectives of the study: To understand the commodities market in India.

To suggest investment Buying decisions.

To know about the Perception of the consumer regarding commodity market.

Data Sources
The following methods were adopted in collecting the requisite information regarding the present study. The sources of information were

PRIMARY DATA

: The primary data were collected during the survey with the help of

questionnaires, direct personal interviews and observation of the market. On the basis of the
primary data the analysis and interpretation and the findings of the study has been concluded and hence the primary objectives of the study are completed.

Sample Unit: Amritsar Sample selection: Convenient Sampling

Sample size: 70

SECONDARY DATA : Secondary data was collected through website of the company and web

site of Multi Commodity Exchange (MCX) and National commodity and derivative exchange
(NCDEX).and the data was also collected From the Books As provided by the stock exchange .

Data Analysis and Interpretation

Do you invest in commodity market? Response Yes No Total No of Respondent 65 5 70 Percentage 93% 7% 100%
93%

Percentage
7%

Yes

No

Interpretation: The above chart Reveals That 93% of the investor invest in the
commodity market and the rest 7% do not have interest in Commodity market.

If No, why Percentage Reasons Number of Respondent Percentage

0%

Not aware About The Avenue

Insufficient Income Other Specify Total

60%

40% 60%

Not aware about the avenue

Insufficient income
Other Specify

2 0 5

40% 0% 100%

Total

Interpretation: The above pie chart Reveals That the 60% of the respondent are not
aware about the avenue of the investment and the rest 40% have Insufficient income for investment purposes.

In which commodity Exchange You Prefer to Invest? Types Number of Percentage Respondent
80%

Percentage
80%
70% 60% 50% 40% 30% 20% 10% 0% 0% MCX NCDEX Other specify 0% Cant say 20% Percentage

MCX NCDEX Other Specify Cant Say Total

52 13 0 0 65

80% 20% 0% 0% 100%

Interpretation: The above chart reveals That the 80% of the respondents prefer
MCX and the Rest 20% Prefer to invest in NCDEX.

In Which Segment of Commodity you prefer to invest? Types Bullions Agriculture Metals Fossils/ Energy No of Respondent 34 7 15 9 Percentage 53% 11% 23% 13%
60% 50% 40% 30% 20% 10% 0% Percentage Bullions 53% Agriculture 11% Metals 23% Fossils/Ene rgy 13% 11% 23% 13% 53%

Percentage

Total

65

100%

Interpretation: The Above chart shows that the most of the respondents i.e. 53% invest in the bullions segment ,23% in metals,13% in

fossils/energy, and the least 11% in the agriculture

How Often you made investment in commodity market?

Type Intraday Carry Forward Total

No Of Respondent 40 25 65

Percentage 61% 39% 100%

70% 60% 50% 40% 30% 61% 39% Percentage

20%
10% 0% Intraday

Carry forward

Interpretation: The above table shows that the 61% are the intra day
investor and the rest 39% are the carry forward investor.

What type of analysis do you make before investment? Analysis No of Respondent 55 Percentage
15% Technical 85% Fundamental analysis

Percentage

Technical Analysis

85%

Fundamental 10 Analysis

15%

65

100%

Interpretation: The Above Pie chart show That the 85% Of the respondents Depends
upon the Technical analysis and rest 15% depend upon on Fundamental Analysis.

What is your Perception Regarding Commodity Market? Perception Less Risky Risky Very Risky Total No Of Percentage Respondent 0 52 13 65 0% 80% 20% 100%
80% 70% 60% 50% 40% 80% Percentage

Percentage

30%
20% 10% 0% 0% Less risky Risky Very risky 20%

Interpretation: 60% of the Respondents Shows that they consider the commodity
market Risky and the rest 20% or 11 respondent consider the market very Risky.

From where you get advice of investment in these segments? Factors Print Media Family Electronic Media Broker advice Total No of Percentage Respondent 0 3 58 4 65 0% 4% 90% 6% 100%
90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Percentage
90%

Percentage

0% Print media

4% Family Friends Electronic media

6%

Broker advice

Interpretation: The chart reveals that 90% of the respondents depends upon the advice
that comes on TV. Rest 4% and 6% consider the advice of their Family and Brokers

What is the Basis of Your Investment Decision? Basis Take their own initiative No of Percentage Respondent 39 60%
5%

Percentage

Own 23 initiative with help of others

35%

Take your own initiative 35% 60%

Take your initiative with help of other Decision made by expert

Decision made by expert

Total

5%

65

100%

Interpretation: 60% of the Respondent take their own initiative for investment in
commodity market.35% make their own initiative with help of others and 5% depend upon the decision made by expert

Do you look at commodity price movement? Options Rarely Frequently Daily Not at all Total No of Respondent 0 0 65 0 65 Percentage 0% 0% 100% 0% 100% Percentage
100%

100% 80% 60% 40% 20% 0% 0% 0%

Percentage 0% Percentage

Interpretation: The above graph reveals that 100% of the respondent see
to the daily market movements

What is the purpose of Investment on commodity market? Purpose Liquidity Return is Good Tax Benefits Total No of Respondent 7 58 0 65 Percentage
90% 80%

11% 89% 0% 100%

70% 60% 50% 40% 30% 20% 10% 0% Liquidity 11%

89%

Percentage

0% Return is good Tax benefit

Interpretation: The above table shows that 89% of the respondent invest due
to high rate of return and the rest 11% invest due high volatility in the market.

Are you satisfied by the Return you getting back? Response No of Percentage Respondent
20%

Percentage

Yes No Total

52 13 65

80%
Yes No

20% 100%

80%

Interpretation: The above pie chart reveals that the 80% of the respondents are
satisfied from the return they getting back from the commodity market

Limitations

The study is limited to Perception of Consumer regarding commodity Market in

the Indian context.

The study cannot say as totally perfect as it is subjected to many alteration. In depth the study was not possible due to time constraint.

Many of the respondent does not want to share where they have invested their
money to the outsider.

Findings

Commodity market provides a good source of investment.

Market movement is only according to supply and demand. Any time there will be three contracts alive on execution for all commodities i.e. Current, near, and far. Premium will be charged for purchasing near and far months contracts. And premium charges will be

different for near & far month contracts.

The most things I have seen are that the awareness of future commodity trading is still not there. Most of the people invest in the commodity market because return is quite good. Most of the people prefers to invest in the bullions segment i.e. is Gold and silver

People still considering that to invest in commodity market is very risky.

The whole industry is highly sensitive towards national and internationals Environmental and political factors. 60% of the respondent takes their own initiative while investing in the commodity market.

People who knows, they believe that operators and big players in the market drive this future
commodity market. Most of peoples feel that the qualities of the commodities are not as per the requirement

Suggestions

The FMC should allow Option trading in commodity market in India.

The FMC has to take some steps to increase the awareness of future commodity trading India. The government as to allow FIIs to invest in commodity market in India in future market not in option.

The FMC should increase the range of commodities in future commodities in commodity market in
India.

To motivate the commodity business in India the FMC should come up with some rebate in taxes. The FMC should increase the delivery centers of commodities in India. As commodity market is very potential for business, the India Infoline. should think about various ways to attract the customers.

Market intermediaries should take more efforts on spreading awareness about commodity market. Risk in commodity market is low when you compare to equity & derivatives. Silver, aluminum and gold fetch high profits when compared to other commodities. So I suggest investing on these three products for gives high returns.

Conclusions
Commodities provide good source of investment Decisions can be taken through technical analysis

One should invest his /her money by having the proper knowledge of the trade market.
In commodity market the risk of losing the money is low as compared to the Equity .