1. Participants in Commodities

2. Participants in Commodity Derivatives Speculators Hedgers Arbitragers

3. Speculators Speculators are interested in making money by taking a view on future price movements. The main objective of speculation is to take risks and profit from anticipated price changes in futures price of an asset. A speculator will buy futures contracts (long position) if he anticipates an increase in the price of the commodity in future and vice versa

5. Buy 1 lot of gold futures of November expiry

6. Gold futures contract is trading at 12,000

7. Your position is worth Rs. 12,00,000

9. Square off your position

12. At the price of Rs. 12,000

13. He wants to protect the reduction in the price of gold till the jewellery is ready for sale

15. He sells his gold in spot market

16. Square off his position in futures at Rs. 12,000

18. Thank You