Introduction of Derivatives

The aim of this module is to provide beginners as well as the dealers with both theoretical and applied knowledge pertaining to commodities trading. The module is beneficial for those who wish to pursue careers in brokerage firms dealing in commodity derivatives. This module has been developed jointly by NSE and NCDEX.

Why should one take this course?

•To understand the difference between commodity and financial derivatives.
•To know the usage of commodity futures.
•To understand the pricing mechanism of commodity futures.
•To learn about the NCDEX trading platform, clearing and settlement operations.
•To know the regulatory framework and taxation aspects of the commodities market.
Who will benefit from this course?

•Students
•Teachers
•Commodity Market Dealers
•Researchers
•Employees of BPO/IT Companies
•Anybody having interest in the Commodities Market
Test details

Duration: 120 minutes

No. of questions: 60

Maximum marks: 100, Passing marks: 50 (50%); There is negative marking for incorrect answers.

Certificate validity: For successful candidates, certificates are valid for 3 years from the test date.

Fees

1,800/- (Rupees One Thousand Eight Hundred Only)."

Course outline

•Introduction to Derivatives
Introduction to Derivatives; types, Products, participants and functions; Exchange–traded versus OTC derivatives.
•Application of Futures & Options
Types of instruments (future, options)-Basics and Payoffs; Pricing commodity derivatives; Hedging, Speculation and Arbitrage
•Commodity Derivatives
Difference between commodity and financial derivatives; Global and Indian commodities exchanges; Evolution of commodity market in India.
•NCDEX Platform
Structure of NCDEX; Exchange membership; Capital requirements; Commodities traded on NCDEX platform; Instruments available for trading; Pricing of commodity futures; Trading; Clearing, Settlement and Risk Management;Use of commodity futures in hedging, speculation and arbitrage.
•Regulatory Framework & Taxation aspect
Rules governing commodity derivatives exchanges; Intermediaries, Investor grievances and arbitration, Implications of sales tax.