Lohri 2023: Best Time to Start Commodity Trading

Introduction

In an Indian household, petrol is a necessity, and wheat and coffee are staples. Commodities like these play a significant role. What if we told you that using these commodities could translate into gains for you? Through commodity trading, you can make money on the increasing demand for commodities in the global market. In this article, we will tell you why at this auspicious time, you should get into commodity trading on Lohri.

What is Commodity Trading?

Commodities are made from raw materials used for manufacturing goods. They can be categorised into energy commodities, base metals, bullion, and agricultural commodities. They are the building blocks of an economy.

Traders engage in commodity trading to make money on the price of commodities. Most often, commodity trading happens via trading in commodity futures.

A commodity futures contract allows you to buy or sell a specific commodity at a particular price on a pre-decided date in the future. You can profit from changes in prices without taking actual delivery of goods.

While commodity trading can be complex and requires expertise, it can often yield higher profits than equities trading. If you want to make money in trading, this is the best time to start commodity trading.

Why Start Commodity Trading on Lohri?

1.       Increase in Supply of Agricultural Commodities

Lohri is a festival that celebrates the end of the winter solstice, ushering in new produce. This is when rabi crops are harvested. If you want to begin trading in sugar commodities, you can start commodity trading on Lohri.

2.       Auspicious Time
Lohri, Pongal or Bihu, no matter what you call it, is an auspicious time in India. As a country that believes that new beginnings should start at an auspicious time, it is the best time to start commodity trading. If you want to invest in gold, you can invest in gold commodities instead of physical gold.
 
3.       Higher Returns
As mentioned above, if you want to make higher returns from trading, you should consider starting commodity trading on Lohri rather than doing stock trading.
 
4.       Hedge Against Inflation
Commodities are products that people require on a daily basis. During inflation, when the prices of stocks fall, the prices of commodities will rise because they are necessities. This makes commodity trading a good hedge against inflation.
 
5.       Portfolio Diversification

A well-diversified portfolio provides an opportunity to hedge against price fluctuations. By investing in commodities, especially metals like gold, you can protect your portfolio from fluctuations in market prices.

Conclusion

Commodity trading can prove to be a profitable endeavour if done correctly. Spend time to understand how commodities function, and this year, get started on commodity trading on Lohri.

Disclaimer: ICICI Securities Ltd. (I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investments in securities market are subject to market risks, read all the related documents carefully before investing. Investors should consult their financial advisers whether the product is suitable for them before taking any decision. The contents herein mentioned are solely for informational and educational purpose.