Investors who want to precisely diversify their portfolios beyond shares, bonds, Bank FDs and real estate, commodities is the best option for them. Commodities, such as energy products and agricultural products, bullions and base metals, tend to rise in price as per inflation. Hence, they can offer inflation protection in a portfolio. Navkar aims to connect the Commodities market’s immense potential by providing you a simple yet effective interface.

There are two ways for investors to gain profitable exposure to commodities

1) Purchase of shares of the commodity or natural resources Company

Investors can invest in shares of companies that have a considerable portion of their operations in the explo­ration, production, recovery, and processing of commodities. For instance, an investor who actually wants exposure to oil may buy shares in a major oil company.

2)     Purchase of commodity derivatives

Inves­tors can purchase derivatives in which the precise underlying asset is a commodity or a commodity index. Mainly the commodity derivatives include forwards, futures, options, F&O and swaps. Futures and some of the options are traded on exchanges, whereas forwards, swaps, and other options are privately negotiated agreements.

·         Robust risk management

·         Seamless transfer of funds

·         Help generating returns

·         Experienced, accomplished and practised team

Commodities offer vast potential for the market-savvy investor, arbitrageurs, speculators, and retail investors to become separate asset classes. They are broadly considered as a hedge against inflation. This scenario implies that commodities be held for the longer term.

• Diversified Investment Portfolio

During a stock market downturn, investing a fixed percentage of the corpus into the commodities market can help individuals reap a high return on investment (ROI). Suppose you are already investing in stocks and bonds. In this approach, you will be compensated for lower or negative profits whenever there is a stock market crash by staying invested in the commodities market. So, it is always advisable to consult an investment broker.

• Inflation Hedge

Technical analysis tools prove commodities to be a profitable instrument for individuals having a long term investment viewpoint. For example, the prices of top commodities like gold tend to rise over time, at a swifter rate when matched to rising inflation rates in a country. This scenario allows investors to enjoy a rise in the real value of their corpus investment.

• Margin Trading

An investor in commodity futures needs to put a certain amount as a margin with the broker. Thus, the investor can take larger positions while investing lesser amounts of capital. This scenario also helps increase the potential for higher profits.

• Substantial Returns

Commodity markets are unpredictable. They can experience huge swing in prices. A prime example of volatile goods is crude oil, whose price varies due to fluctuations in supply, mining problems, or socio-economic conditions. Speculators invest in commodities to profit from such price volatility.