Study on Commodity Market - September 8th, 2010
A study on
Commodity market-A new source of investment and customer preference
Ever since the dawn of civilization commodities trading has become an integral part in the lives of mankind. The very reason for this lies in the fact that commodities represent the fundamental elements of utility for human begins. The term commodity refers to any material, which can be bought and sold. Commodities in a market’s context refer to any movable property other than actionable claims, money and securities. Over the years commodities market have been experiencing tremendous progress, which is evident from the fact that the trade in this segment is standing as the boon for the global economy today.
The promising nature of this market has made them an attractive investment avenue for investors. In the early days people followed a mechanism for trading called barter system, which involves exchange of goods for goods. This was the first form of trade between individual and even nations. The absence of commonly accepted medium of exchange has initiated the need for barter system. People used to acquire those commodities which they lacked in exchange of those commodities which are in excess with them. The commodities trade is believed to have its genesis in sumeria. The early commodity contract was carried out using clay tokens as medium of exchange. Animals are believed to be the first commodities, which were traded, among individuals. The internationalization of commodity market integration that occurred after the European voyage of discovery during the 15th century. The development of international commodities trade is characterized by the increase in volumes of trade among the nations and the convergence of price related to the identical commodities in different markets. The major impetus for the commodities trade was provided by the changes in demand patterns, scarcity and the supply potential both...
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