The gist of trading in commodities or any other market is to buy at cheaper price and sell at higher price. The difference is the profit you get. The commodity market has changed a lot from slow, little-hole-in-the-wall trading offices next to packed markets in narrow streets, to brand new commodities exchanges. MCX and NCDEX have been set up and everything is fully computerized.
If this one reason of convenience and advanced trading culture is not enough for you to trade in commodities then worry no. There certainly are many more reasons as well. Commodity trading is quite simple and streamlined. If you believe gold price will rise then you can buy gold ingots, store them and as soon as prices hit the expected rise, sell them. Certain things to be careful about includes, the purity of gold that you buy, the place to store it and its transportation to the vault. If you find it inconvenient then investing in gold futures from commodity exchange can best help you meet your requirements.
Now, as far as the investment ideas for commodity is concerned then simply by being cautious about the market updates, and trading according to market trends you can easily get great returns. When you buy gold futures contract, you shave to undertake these three things. Buy the amount of gold specified in the contract. The buying pricing would be same as mentioned in the contract. Generally, traders prefer to buy it on the expiry of the contract. The expiry could be from one month after you made the purchase or two months, three months and so on. The thing that is of really importance for you is to understand that if you sell the gold futures contract before it expires then you don’t you don’t have to worry about actually buying the gold.
Remember compared to stocks, commodity trading is much pocket friendly because margins are much lower than in stock futures. In addition, you can get access to commodity tips to trade safely and accurately.