India’s commodity market is no longer the exclusive preserve of large industrial buyers or institutional funds. Supported by electronic, tighter regulation and a surge in digital‐first brokerages, retail investors now enjoy near-instant access to bullion, base metals and energy derivatives.
This guide explores—in detail and with hard data—the five most liquid commodity segments in India’s stock market and shows you exactly how to invest, hedge and trade them profitably.
How to Invest in the Commodities Market in India?
Retail participation begins with opening a demat + trading account at a registered broker that offers direct routing to the appropriate exchanges for bullion, energy and base-metal contracts, as well as commodity ETFs. After verification, you receive a unique client code that lets you place orders via web, mobile or API. Clearing and settlement are handled centrally, using risk-based margining to ring-fence counterparty risk. Contracts are cash-settled in rupees, although they align with international commodity benchmarks.
You can invest through:
Exchange-traded futures (e.g., mini gold, crude oil mini, copper, natural gas) that trade on extended market hours, with small tick sizes and lot values starting relatively low for mini variants.
Physically-backed ETFs which track spot bullion prices net of expense ratios.
Bonds and electronic receipts for gold that carry sovereign backing and no storage risk.
Digital bullion platforms that allow small, regular SIPs in gold or silver, which is securely stored.
Options on futures contracts in copper or crude oil, offering limited-risk and lower margin entry points.
Margin requirements for most contracts range from 4% to 10% of notional, enabling efficient leverage but also magnifying mark-to-market swings. Beginners should start with mini lots, use bracket orders, and never allow mark-to-market losses to exceed 2% of trading capital per session. Silver trading, crude oil futures, copper futures, natural gas MCX quotes and investing in gold and silver all become straightforward once you combine real-time price feeds with an audited risk plan.
Let's understand the top 5 commodities to invest in the Indian stock market.
Read more here: https://bigul.co/blog/stock-market/top-5-commodities-to-invest-in-through-the-indian-stock-market
