Why Invest in Commodities….
• Global Institutional Investor interest in commodity trading has increased significantly over the past few years. This, in part, reflects powerful cyclical and structural forces working in favour of commodity markets, while, also the realisation of the need to diversify personal investments into upcoming and popular financial products.
By what are these commodities ???
• Commodities are goods that are typically used as inputs in the production of other goods and services. Commodity prices are determined largely by supply and demand interactions in the global marketplace. Supply and demand conditions may be influenced by factors like the weather, geo – political events, and supply – side shocks (e.g. wars, hurricanes).
• Some examples of commonly traded commodities are energy products like oil and natural gas, metals like gold, copper and silver and agricultural products like sugar, coffee and soybean.
Benefit of Investing in Commodities.
• Commodity returns have historically had low or negative correlations with the returns of other major asset classes, and may be used to diversify a portfolio. Other factors remaining same, diversified portfolios will low aggregate correlation tend to have lower volatility of returns. Therefore, diversification may improve risk – adjusted returns.
• Changing macroeconomics factors (like inflation) tend to impact commodities differently from other financial products. Prices of goods and services rise in tandem with input prices, while prices of stocks and bonds tend to decline because of rising commodity input prices which put pressure on the economy and lower the value of future cash flows.
Hedge against event risk
• Geo-political events like wars and supply disruptions due to natural disaster like hurricanes, droughts and floods may impact the supply of, and increase the demand for certain commodities, including commodities in a portfolio may act as a potential hedge against certain types of event risks.
What we offer… Or WHY TRADE WITH B R JALAN
• We offer trading and hedging solutions to clients. We act only on the client’s instructions / orders. And, based on their independent decision, we help them in their hedging process, including implementation and continuous monitoring of their positions.
• Our guidance helps clients withstand the vagaries of commodity price fluctuations in their businesses, which may generate higher risk – adjusted return to their capital.
• The exclusive benefits available to our clients, who are Proprietary Firms, Partnership Firms, Public and Private Limited Companies and HUFs, are:
i. Top class service on execution and post – trade assistance.
ii. In – depth research on commodities of Individual Interest.
iii. Direct access to the Top Management.
iv. Round – the – clock risk management system.