1. Would you like to join the IL team? See open jobs!
    Dismiss Notice
  2. Liked anything that you read here? You may nominate it as the Finest Posts!
    Dismiss Notice
  3. What can you teach someone online? Tell us here!
    Dismiss Notice
  4. Take the 100 Days Positivity Challenge : Join Here
    Dismiss Notice
  5. If someone taught you via skype, what would you want to learn? Tell us here!
    Dismiss Notice

The question of service charges for Commodity Trading

Discussion in 'Money Matters' started by cempt, May 5, 2010.

  1. cempt

    cempt New IL'ite

    Messages:
    1
    Likes Received:
    0
    Trophy Points:
    1
    Gender:
    Male
    [FONT=&quot]The regulatory authorities have given the participants in the freedom to decide their service charge structure. The participants are competing with each other for depository accounts, and thus one can negotiate the service charge for his account based on the level of activity and the volume of commodities brought and sold.[/FONT]
    [FONT=&quot][/FONT]
    [FONT=&quot]The regulatory authority, however, charges its depository participants and these include:[/FONT]
    [FONT=&quot]• Custody charges based on the average market value of the commodities held in the account, subject to an overall ceiling based on the average holding in the demat form with the depository participant[/FONT]
    [FONT=&quot]• Settlement charges based on the market value of the commodities to be traded on a particular day, whichever is higher[/FONT]
    [FONT=&quot][/FONT]
    [FONT=&quot]Both the regulatory authorities and the traders must abide by the legitimate rights laid down in the Bye-law and Business rules that govern:[/FONT]
    [FONT=&quot]• Fee and Charges[/FONT]
    [FONT=&quot]• Re-materialization Charges[/FONT]
    [FONT=&quot][/FONT]
    [FONT=&quot]The commodity trading business will not be the same without a regulatory authority. Actually, the regulatory authority acts as a watchdog. If the regulatory authority is absent, then it will become a free for all and the genuine players will have gone bust within a short span of time. For the proper functioning of the regulatory body, it needs to generate its own income. This money is generated through the fee levied on the commodity trade. Actually, free trade is not that free. Free trade will be free only if there is a watchdog to ensure that the freedom allowed is not trampled down by a few prominent traders.[/FONT]
    [FONT=&quot][/FONT]
    [FONT=&quot]The commodity trading business is a profitable option if the various players adhere to the rules and regulations laid down by the regulatory authorities. Often, most traders are able to make up the losses in one trade by generating profits in another trading day when the market is on the upswing.[/FONT]
     
    Last edited by a moderator: May 5, 2010
    Loading...

  2. orion80

    orion80 Platinum IL'ite

    Messages:
    2,648
    Likes Received:
    552
    Trophy Points:
    233
    Gender:
    Female
    Great info. Thanks for sharing
     

Share This Page