Commodity Trading vs Equity Trading
Intraday
trading is a risky type of investment where both equity and commodities bear
risk factor. Equity markets are only
open for a few hours at a time, so there's no reason to look at the computer
all day, but commodity markets are open from 9 a.m. to 11:55 p.m.
Both are
asset groups that investors trade around the world to make money or get a
better return on their investments. However, the distinction is in the manner
in which they are purchased or sold, owing to the inherent properties that
distinguish them.
Difference between commodity and equity
The primary
difference between commodities and equity is that commodities are
undifferentiated goods in which investors invest and commodity contracts have a
set expiry date, while equity refers to capital spent by investors in order to
gain ownership of a business and equity contracts have no expiry date.
Commodities
are traded on short-term that are usually used to hedge losses or quickly make
gains on risky bets. Whereas equity is primarily a long-term investment for
acquiring ownership and profit share in a new or rising enterprise in order to
ensure its long-term viability.
How to Invest in Equities & Commodities
Both
commodity and equity markets are different ways for investors to make money and
get a decent return on their investments. The method by which these asset
groups are exchanged, however, is different. Commodity contracts are often used
by traders or speculators to make fast gains because they only allow one to
take positions and do not grant any ownership in the underlying.
Equity, on
the other hand, offers ownership without a time limit or any liability, making
it attractive to long-term investors. After all, it is perhaps the most common
asset class, offering investors steady, less volatile, and better returns all
over the world.
Takeaway
Traders and
investors who are willing to invest their money for a considerable time can opt
for Equity. And those who are willing to close positions quickly in an intraday
trade can opt for commodity trading. Although it also depends on trader’s risk
appetite and trading goals.
One can
make good amount of profit through Intraday commodity trading by exploiting the
price fluctuations as the positions are closed on the particular day itself. On
the other hand, one can invest money in equity for steady gains and ownership
benefits. Indira securities is one of the best service providers to get
assistance for trading in the market successfully.
Click on https://www.indiratrade.com/ to
get more knowledge about the market.