On What Basis a commodity price is Bought and Sold

I am a fresher and had the following doubt.

Eg:

Commodity - Alumini

Lot Size - 1 MT

Price of 1 kg - 123.45

NRML margin - 6172

MIS margin - 2469

When I have to buy 1 MT of Alumini I should pay (123.45 * 1000) (because 1 MT = 1000 KG) which is 123450 Rs… but in NRML margin how come I pay only 6172 Rs. On what basis this value is fixed. I can see all the other commodities also have this price variance. If any one could help on this doubt it would be thank full…

https://zerodha.com/margin-calculator/Commodity/

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As it is futures contract, exchange ask trader to keep only "initial margin(span margin)" it is a certain percentage of total value of the contract.

and percentage will as below

 SR. NO Span Script Span Margin Amount Span Margin % 1 ALUMINI 6172.5 5 2 ALUMINIUM 30862.5 5 3 BRCRUDEOIL 31825 5 4 CARDAMOM 4688 5 5 COPPER 21022.5 5 6 COPPERM 5256.25 5 7 COTTON 22875 5 8 CPO 25555 5 9 CRUDEOIL 29750 5 10 GOLD 143440 5 11 GOLDGUINEA 1152.5 5 12 GOLDM 14283.5 5 13 GOLDPETAL 147.15 5 14 GOLDPTLDEL 149.95 5 15 GUARGUM 67900 10 16 GUARSEED 25375 10 17 KAPAS 9680 5 18 KAPASKHALI 9090 5 19 LEAD 33675 5 20 LEADMINI 6732.5 5 21 MENTHAOIL 12776.7 5.06 22 NATURALGAS 19664.25 6.68 23 NICKEL 17046 6 24 NICKELM 6818.4 6 25 POTATO 11137.5 5 26 SILVER 64975.5 5 27 SILVER1000 2195 5 28 SILVERM 10833.75 5 29 SILVERMIC 2166.65 5 30 ZINC 34775 5 31 ZINCMINI 6955 5

This span margin will be the NRML margin and MIS margin will be 40% of NRML margin

2 Likes

Thanks for the solution…
So for every commodity we can buy 1 lot with only 5 % (or the mentioned percentage) of the entire lot value…Is it correct Nagaraju…
Normal commodity trade is otherwise called future contract am I correct…

All commodity in MCX you have to buy in lot size with mentioned span margin ,
and
All commodity are future contract.

Understood …Thank u Nagaraju…