NISM Series XVI - Commodity Derivatives Exam Notes
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Soft commodities are the perishable agricultural products such as corn, wheat, coffee, cocoa, sugar, soybean, etc.
Hard commodities are natural resources that are mined or processed such as the crude oil, gold, silver, etc.
Spot market is a place where commodity is traded, and the transfer of ownership takes place immediately. This concept is also termed as 'ready delivery contract' under which payment and delivery of good happens immediately.
2 variants of spot market - physical spot market and electronic spot market.
A spot commodity exchange is an organized marketplace where buyers and sellers come together to trade commodity-related contracts following the rules set by the respective commodities exchange.
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