There are so many traders who like to work in the equity market. But also there are traders who like to invest and trade through the commodity market. It is a profitable market just like the equity one. But it is important to have a commodity trading account to trade in commodities. By opening an account in the commodity market you are able to take the 1st step into this market. There are so many broker houses that open commodity trading accounts. We shall go through some of them in the following.
Frequently Asked Questions about Commodity Trading Account
As stock traders when any person opens a Demat account, It got listed in the NSE or BSE. Similarly, when a person opens an account for commodity exchange, it got listed under the MCX (Multi Commodity Exchange) or NCDEX (National Commodity and Derivative Exchange).
There is no such required amount to start in the commodity market. A newbie can start with any amount that he/she prefers. Then go ahead with the price of the commodity that he is intending to trade-in.
There are mainly three types of commodities that are most preferable for the traders to buy and sell. Those are future contracts, ETFs or Mutual Funds, and the physical commodity itself.
Upstox, Zerodha, and Aliceblue are some of the famous broker farms to open commodity trading accounts.
What is a commodity account?
Commodities are raw materials, minerals or basic agricultural products. It could be raw materials like – gold, silver, crude oil, natural gas, or agricultural products such as wheat, oilseeds, pulse, etc. Commodity trading is when a trader gets access to buy or sell the commodities through the MCX or NCDEX exchanges. Traders and investors mostly like to trade through Futures and Options in the commodity market.
Top Broker houses to open Commodity Trading Account
There are two ways to open any commodity account under any sub-broker house- online and offline. In the following, I shall discuss the top 3 broker houses to open a commodity account with. I shall also explain how to do the commodity trading account opening process offline as well.
It is very easy to open a commodity account in Zerodha. Just need to follow a few steps to do so. But first, you have to open an equity account. Many traders and investors do the process while opening an equity account under Zerodha. It helps them to do trading or investing in both the accounts, equity as well as a commodity.
Zerodha commodity account opening process
Opening a commodity trading account in Zerodha is very easy and just a few steps away. The following process is for the equity account in Zerodha who wants to open a commodity account as well. First, go to your Zerodha Kite and log in to your account.
When the inactivated commodity account page looks like the above one. From there click on your ID. A list will appear on your right-hand side of the screen. Clicking on the console will be the next step to follow.
After that, a new page will appear which looks exactly like the following image.
From there go to the account option. The account option is just beside the dashboard. After coming to the console the account option will appear among the option on the dashboard.
1st step: How to go to the commodity Segment?
The new page comes after clicking on the “My Account” option from there goes to the segment option. The segment is on the left side of the screen, just under the Demat option. In the above image, I have presented it in a red rectangular box.
After clicking on the “segment” a new page will appear. All the segments are presented on this page. Now active all the segments that are still not activated among the options list.
Click on the commodity that is at the end of the segments. Here I have presented it in a red rectangular box.
2nd Step: Personal Info
As soon as you arrive at the commodity processing page click on the income option. In which you will see so many income limits such as below 1 lakh up to 1 cr. Select that according to your preferences.
Then next comes the “Trading experience”. Just like the previous one, this will also provide several options in which you will have to choose your preferred one. It starts from trading experience from 1 year and the categories expand up to 15 years. If you are new to stock market trading then there is also an option of “New” as well.
The next one is Income proof. Select income proof from the provided place which is according to your income limit. Then just to verify that add a 6-months bank statement in PDF form in the next option. If your bank statement is protected by any kind of password then put the password in the next place. Because without that Zerodha broker house will be unable to check the bank statement. If the statement is not password protected then there is no need to put the password. Keep the place blank and proceed. Now click on Continue in the blue box.
3rd Step: Esign process
After the submission, go ahead with the term and conditions of the page that will appear on the screen. Tick on the small square boxes and then click on Proceed to Esign for the further process.
OTP Verification through Email id
One thing to keep in mind is that if your Aadhar is not linked with your phone number. Then you might go through an additional process.
That is Email verification. In such a scenario, An OTP will be sent to your email id which will be needed for the verification purpose. Continue with email verification. Here I am going with the email verification process in this step you will put your email address and Zerodha will send you OTP on that. Put that on the given place be careful as it lasts for only 30 seconds only. Then click on submit.
A new page will appear just like the image down below. As you have read by the heading this form is for KYC Verification. After going through the page click on the sign now option.
After the last submission, a new page will appear which is basically a form. Sign it up.
4th: NSDL verification through Aadhar otp
In the next step, the NSDL page will appear on your screen. Tick the small square box then go for the next OTP verification step.
Here in the box put your Aadhar card linked mobile number in the given place. (If the mobile number is not linked with your Aadhar card then it might be a problem. Because the OTP number will be sent as an SMS form to that mobile number that is linked with the Aadhar card). After putting the mobile number click on send OTP option just beside it.
The next page will look something like the above one. As the authority will send an OTP to the mobile number you have placed in the box on the previous step. Here on the new page, there will be a place asking for that OTP. Put the same OTP in the given place. That you got earlier on your mobile number which is linked with your Aadhar. Then click on verify OTP.
After processing all the steps correctly. The successful page will arrive soon on your screen. That looks something like the following one. Though it might take a few days to active commodity trading account.
How to check that the commodity account is activated?
Upstox has the membership of Multi Commodity Exchange or MCX. So it offers various online commodity trading services to its customers. Opening a commodity account in Upstox is very easy and the brokerage is only 20 rupees per order. The account opening charge for a commodity trading account in Upstox is only 150 rupees. The AMC or account maintenance charges are free.
Upstox commodity account opening process
You can enable a commodity trading account in Upstox in two ways. Either you can enable a trading account by choosing it at the time of opening an equity account in Upstox or you can follow the same steps to enable commodity segment after account opening as well.
The account opening process starts with entering a mobile number in the very first step. Then an OTP will be sent to that mobile number. In the above image, you can see where you have to put the number.
Put that OTP to the given place then click on continue. Just like the above image.
After the OTP verification, you have to put a six-digit pin. This pin can be arranged by your preference. Then click on “Continue”
The next step is the Pan Verification. In this step, a pan card will be needed. As it is an important step you can not skip this. So put your pan id number in the given place. then put a birth date according to your Pan id. Then click on continue and proceed to the next step.
The next page will ask for your personal details such as gender, marital status, annual income, and some other things. The image provided above contains all the personal details related to questions which you have to answer. Just like the previous one click on continue and move on to the next page.
This is one of the important pages as it asks for the segment. Now the very first one is the commodity segment which you will put yes. As you want to invest or trade in the commodity segment. It is important to active this segment.
Now read the Tax Payer Declaration form carefully and tick the small boxes and proceed by clicking on continue.
In the next step, Upstox provides free stocks. Now if you want free stocks then click on “I want a stock for rs 0” and proceed further.
Now put a digital signature and click on continue.
Click on Connect now and then put your Aadhar details clearly to avoid rejection.
Put your Aadhar number and click on next.
Put all the bank account details. Such as the Account holder’s name, IFSC code, and bank account number. Click on continue and visit the next page.
Now again active commodity segment then uploads your income proof.
In this step, you can put any three nominees or you can simply skip this step by clicking on “I’ll do it later”.
This is the time of Aadhar verification. An OTP will now be sent to that mobile number that is linked with your mobile. After the OTP verification, you are ready to continue with the E-sign process.
Now put the OTP and click on verify OTP. If there is any issue then cancel this or try again by sending the top again. Just click on Resend OTP and do the step again without canceling it.
All the process is completed now. If there is no issue regarding the steps then you will receive a message regarding account opening on your email id or phone.
Alice Blue is an MCX and NCDEX member that provides customers with online commodity trading services. New users must open an Alice Blue Commodity Account to begin trading on the MCX while existing customers only need to activate the commodity trading sector. The discount brokerage business offers the cheapest online commodity trading brokerage at a flat rate of Rs. 20 per order. On this page, we’ll show you how to open an Alice Blue Commodity Trading account, as well as how to activate MCX segments, commodity trading brokerage, margin, and more.
Aliceblue commodity account opening process
While doing the equity account opening process there are various options. Account opening in Alice blue is easy but you have to keep in mind that you can open your commodity account side by side to the equity account opening process.
- In the very first step, you will have to fill up your name,
- Put the email Id on the given space,
- Select your state then write your city name.
- In the last blank put your mobile number.
- Then tick the small square box and complete this process by clicking on open an account.
After clicking on it a new page will appear in which your email id and mobile number are already be filled. If you want to continue the account opening process then click on.
The next step is email verification. The broker house will send an OTP to your email id. Copy that OTP number and put it to the given place. If there is any mistake that happens with the number, there is nothing to worry about. As there is an option to “Resend OTP”. Then click on validate and proceed to the next step.
Pan Card verification
In this step pan card is necessary. Put your pan number to the given place. Fill your birth date on the next blank. It is better if the date of birth is according to your pan card otherwise this document might going to be rejected.
As you have already provided your Pan card details on the previous page. This page comes as a filled-up page as per the pan card details.
As you can see in the following image. I have put the bank details section under a red rectangle. In this section put your bank account details along with the IFSC code of that account. After filling in all the bank details click on verify.
After this verification, the Income proof-related queries will appear. Fill that place according to your preference. In this section, you need to upload your income proof. At last click on Validate again.
I have presented the top broker house’s full process of opening a commodity account. Zerodha, Upstox, and Alice Blue are quite renowned discount broking houses. Account opening under these broker houses is safe and secure as well. Some of these broker houses also provide a free account opening process in the commodity segment. So paying extra money is also not an issue at all.