Commodity Trading Products & Services

Existing customers: If you have existing 3-in-1 account and your linked Bank account is more than 6 months old or you have securities value above Rs.5000, then you can activate your account for Commodity Derivatives Segment online by accepting the Online Terms and Conditions for Commodity Derivative and submitting Mandatory Communication Details wherein you will have to give mandatory details and commodities preference. If your linked Bank Account is not more than 6 months old or you do not have minimum shareholding of Rs.5000 then you can activate your account for Commodity Derivative Segment by submitting the prescribed documentation.

If your linked bank account is other than ICICI Bank account, then you need to submit prescribed financial document for activation or need to have securities value above Rs.5000.

New customers: If you are not already a registered customer of I-Sec, you will have to open a 3-in-1 or 2-in-1 account with I-Sec by providing proof of identity and address, as prescribed.. However, you will be able to trade in commodity only if you have submitted the financial document or fulfilled the criteria as mentioned in point.

You will receive an e-mail once your form has been successfully processed and you are registered for Commodity Derivatives. You will be required to accept the online Terms and conditions applicable to Commodity Derivatives and submit Mandatory details along with Commodity preference. Further, you will be able to start trading in Commodities when confirmation for Unique Client Code is received from exchange.

To begin with, ICICIdirect offers its customers execution capability on the Multi Commodity Exchange of India Ltd (MCX).

Trading in Commodity derivatives through www.icicidirect.com is allowed during the exchange specified timings. Currently the trading hours on MCX for Commodity derivatives from Monday to Friday between 9:00 A.M. to 11:30 P.M. (up to 11:55 P.M. on account of day light savings typically between every November and March of the following year). Agri-commodities are available for futures trading up to 5:00 PM. whereas other commodities such as Bullions, Metals and Energy products are available up to 11:30 PM / 11.55 PM and Internationally linkedAgri-commodities are available up to 09:00 PM as notified by SEBI/Exchange. Please note these exchange timings are subject to change from time to time on any day for any reason that exchange may deem fit.

As a customer of ICICIdirect, now you can trade on Commodity Futures on MCX. It comes with a comprehensive tracking cum risk management solution to give you enhanced leveraging on your trading limits.

In Commodity Future trading, you take buy/sell positions in commodity Future contracts expiring in different months. If, during the course of the contract life, the price moves in your favor (rises in case you have a buy position or falls in case you have a sell position), you make a profit. In case the price movement is adverse, you incur a loss.

To take the buy/sell position in Commodity Futures, you need to have certain amount of margin to place order(s). With futures trading, you can leverage on your trading limit by taking buy/sell positions much more than what you could have taken in spot market. However, the risk profile of your transactions goes up.

Enabled contracts will be displayed for trading on the site when you select contracts either through the Place order link or the Commodity List page

You can visit on Commodity Place Order page and post clicking on Select Contract, if 'P' is mentioned in the 'Delivery Option' then that underlying commodity is physically settled. If 'C' is mentioned, then that underlying commodity is cash settled.

Physical Settled: You should square off the physically settled positions before the delivery gets assigned to your positions. Please note, ICICI Securities Ltd. will square off your open position in the near month expiring contracts in the Underlying Commodity one day prior to beginning of the tender period start date and will be at the discretion of I-Sec basis the internal risk management policy.

Cash Settled: In case of cash settled contracts you can square off your positions one day before expiry of the contract. ICICI Securities will run EOS as per the time prescribed by the risk management policy of ICICI Securities from time to time. Currently ICICI Securities runs EOS one day before expiry of the contract. Margin blocked on such expired position will also be released and added into your trading limits after adjusting profit/loss on close out. However, it is at the discretion of ICICI Securities to close the position earlier than the expiry even in case of cash settled contracts where it will be a risk management call to square off the position before the expiry, the same will be notified to you from time to time.

You can have following kind of settlement obligation in futures market:

• Brokerage: Any transaction you enter into will attract brokerage. Brokerage is debited in your account at the end of the day.
• Profit and loss on squared off position
• Profit and loss on EOD MTM on open position

You can see your obligation on cash projection page. The date on which amount is to be deducted from your account or deposited in your account can be checked from the 'Cash Projection' page. You can even see the historical obligation (already settled) by giving the respective transaction date.

Commodity Futures obligation is settled by exchange on T+1 basis. This means that any obligation arising out of transactions in futures or EOD MTM on day (T) is settled on an immediate next trading day. This further means that if you have a debit obligation on day (T), the payment will have to be made on day (T) itself. Whereas if you have a credit obligation, amount would be credited in your account on T+1 day. If T+1 days is holiday, credit would be given on subsequent day.