MCX stands for Multi Commodity Exchange, it is an online platform for commodity trading in India. Just like how you invest in stocks of various companies, you can also invest in commodities like Gold, Silver, Cotton, Black Pepper, etc., via MCX.
Confused?
Read the simple article below.
Content:
- What is a Commodity?
- MCX Meaning
- What is MCX Trading? Or How to buy and sell commodities on MCX?
- MCX Timing
- How to invest in MCX?
- MCX History
- Quick Summary
- FAQ(Frequently Asked Questions)
What is a Commodity?
Before we jump into learning What is MCX in Stock Market, it’s important to know What a Commodity is. In simple terms, a commodity is a product that is used in your daily life, like Cotton, Black Pepper, or a commodity that can also be something valuable, like Gold, Silver, etc.
MCX Meaning
MCX stands for Multi Commodity Exchange, it is an online platform for commodity trading in India. Just like how you invest in stocks of various companies, you can also invest in commodities like Gold, Silver, Cotton, Black Pepper, etc., via MCX.
Learn about Commodity Trading here!
What is MCX Trading? Or How to buy and sell commodities on MCX?
MCX trading refers to buying and selling of commodities. You can buy and sell commodities on MCX via derivatives contracts (Futures and Options).
MCX offers trading across different commodity segments like:
- Bullion: Commodity Derivatives in Gold & Silver.
- Industrial Metals: Commodity Derivatives in Aluminium, Copper, Nickel, etc.
- Energy: Commodity Derivatives in Crude Oil and Natural Gas.
- Agricultural Commodities: Commodity Derivatives in Cotton, Cardamom, Black Pepper, etc.
Apart from this, you can also trade in commodity indices. MCX offers three main indices:
- MCX BULLDEX: MCX BULLDEX is the sectoral index that tracks the performance of liquid Gold & Silver Futures traded on MCX.
Check out how much each commodity contributes to the movement of BULLDEX:
| Commodity | Weightage |
| Gold | 70.52% |
| Silver | 29.48% |
- MCX METLDEX: MCX METLDEX is the sectoral index that tracks the performance of Liquid Base Metal Futures (Aluminium, Copper, Lead, Nickel and Zinc) traded on MCX. As the index tracks essential industrial metals, it acts as the indicator for the overall performance of the metals manufacturing industry.
| Commodity | Weightage |
| Aluminium | 9.48% |
| Copper | 29.81% |
| Lead | 12.88% |
| Nickel | 14.77% |
| Zinc | 33.06% |
- MCX iCOMDEX: iCOMDEX is a broader index that tracks the performance of 11 most liquid futures commodities. Check out how much each commodity contributes to the movement of iCOMDEX:
| Commodity | Weightage |
| Crude Palm | 1.34% |
| Cotton bales | 2.09% |
| Crude Oil | 41.22% |
| Natural Gas | 5.47% |
| Aluminium | 2.14% |
| Copper | 6.72% |
| Lead | 2.91% |
| Nickel | 3.33% |
| Zinc | 7.46% |
| Gold | 19.26% |
| Silver | 8.05% |
MCX Timing
Trading time for Bullion, Industrial Metal, and Energy Commodities is 9.00 am to 11.30 pm from Monday to Friday.
For Agri commodities, the timing is 10.00 am to 5.00 pm from Monday to Friday.
How to invest in MCX?
Did you know?? MCX is the only exchange that’s listed in the stock market, and you can buy and sell the shares of the exchange “MCX” on NSE & BSE.
On the other hand, if you want to invest in the “commodities like Gold, Cotton, and Crude Oil listed on MCX”: You can do it via Futures and Options contracts. Not just that, you can also invest in the indices that represent the overall performance of the listed commodities on MCX.
MCX History
MCX was established in 2002; with almost 2 decades in the business and with remarkable technological advances, it has had an incredible journey throughout. Here are some of the key historical milestones of MCX:
| Year | Milestone |
| 2003 | Operations commenced on 10th November. |
| 2006 | Product licensing with CME Group. (World’s leading and most diverse derivatives marketplace) |
| 2012 | MCX shares were listed on NSE & BSE, making it the first listed exchange in India. |
| 2017 | Launched first-ever Gold Options contract in India. |
| 2018 | Launched Options contract in Crude Oil, Silver, Copper & Zinc. |
| 2019 | Launched the MCX iCOMDEX commodity index series, comprising a composite index, two sectoral indices, and four single commodity indices in December. |
We hope that you are clear about the topic. But there is more to learn and explore when it comes to the stock market, and hence we bring you the important topics and areas that you should know:
Quick Summary
- Commodity is a product that is used in day-to-day life.
- MCX (multi-commodity exchange) helps you trade in daily usage commodities like cotton, gold, silver, etc.
- MCX is an online platform for commodity trading in India it is just like investing in stocks, but here it’s for commodities.
- MCX trading refers to buying and selling of commodity contracts.(Futures and Options).
- Commodity Contracts like futures & options can be traded in different segments like Bullion, Industrial Metals, Energy, and Agricultural Goods.
- You can also trade in commodity indices. MCX offers three leading indices:
- iCOMDEX
- BULLDEX &
- METLDEX.
- Precious Metal, Base Metal, and Energy Commodities time: 9.00 am to 11.30 pm from Monday to Friday.
- Agri Commodities time: 10.00 am to 5.00 pm from Monday to Friday.
FAQ(Frequently Asked Questions)
1. Is MCX Trading Profitable?
Yes, it is profitable. MCX gives you the opportunity to trade in real-world commodities like rice, oil, gold, silver, etc. The profits are made with the fluctuations in the price of the commodities.
2. Which is Better, Stock or Commodity?
This is a very subjective thing to answer. Commodities are very volatile in nature compared to equity. Therefore higher volatility attracts higher profits, deeper losses, and more risk. But again, it depends on traders to traders. Some look for higher volatility.
3. How Commodities are Traded in India?
Online Trading in Commodities is done through Commodity exchanges MCX, ICEX, and NCDEX. They are online platforms for commodity trading in India. Just like how you invest in stocks of various companies, you can also invest in commodities like Gold, Silver, Cotton, Black Pepper, etc.
