MCX(Multi Commodity Exchange) is the largest commodity futures exchange established in 2003. Metals, bullion and energy are its major components. Traders with high capital can trade here. Commodity market has always shown its impact on economy and people’s life. Demand and supply is the key factor which is responsible behind price fluctuations in this market, where as economic growth , geopolitical issues, government rules and regulations are some other factors which are also the reason behind the price fluctuations of different commodities.Experts from financial advisory services providers can help with high accuracy MCX Tips to earn better returns on investment from this market.
Some guidelines which can be useful to survive in Commodity market are discussed below :
1)Never be over confident while trading :
Being a trader you must understand the importance of maintaining your emotional stability at the time of trading. Never be over confident with your trading strategy it may leads you to earn repeated loss in the market. Trading with good market knowledge and required confidence can help you to sustain in this market on long term basis.
2)Good patience :
Keep good patience while you trade in commodity market and your trade positions are moving as per your expectations which can help you in extracting your required returns.Don’t be pessimistic here else you will end booking gains per-maturely, making you re-enter the same trade at different levels .
3)Be dynamic while trading:
Don’t stock to any trading pattern: Bear or Bull. As per market requirements decide to be bearish or bullish . Do not restrict yourself to be bear or bull always. Be a wise trader and trade according to market demand.
4)Understand the fact that every market is different :
Traders should not use their stock trading ideas in commodity market. They must understand that both the markets are different and have their respecting trends and guidelines.
Loss is the biggest factor because of which traders fear from this market. As already discussed to trade in this market huge capital is required ,traders fear to loose such big amount.
Following discussed guidelines can help you to avoid loss in commodity market :
1)Diversify your capital:
At the beginning itself traders must analyze how much risk they can afford on their capital by investing it in futures. Also to be on the safe side traders should trade in different commodities rather then trading on some particular commodity.If you are not able to understand market conditions then you must be patient and remain with the same position in market until you understand what actually is happening in the market.
2)Use proper levels and stop loss :
While trading in commodity futures certain risk is involved. Traders must use proper stop loss here in this market. They generally do not use any stop loss and earn huge losses sometimes which makes them finally leave the market.
3)Be prepared and learn about market :
Beginners of commodity market especially should educate themselves first about the market before entering in to it. Also they must trade according to their capability and should not be influenced by other peoples advise. Attending seminars, learning through online tutorials, reading about success traders stories can be helpful for learning about the market.
4)Be attentive in the market :
Traders must keep themselves well updated with all the market movements. Every individual trader has his own system which helps them in earning their required returns and also keep their losses minimum.Having a well planned strategy under any sudden price movement will help you to manage your risk and returns in a better way.
These are some of the guidelines which can help you to minimize your risk in commodity market. Traders can seek advise from stock advisory firms as well for MCX trading tips. This will help them to trade in a well controlled manner and cope up with drawbacks of commodity market in a efficient way.