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.(Which is the best trading option?)
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.
Key differences between Commodities 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.
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.
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. Choose top online stock broking firm for online market trading.
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. (Which is the best trading option?)
author and credit : Raj gupta (Open Demat Account Online with Indira Securities in just 15 mins.)