INTRODUCTION

We are moving from a world in which the big eat the small to one in which the fast eat the slow.-Klaus Schwab, 2000 (founder of the World Economic Forum) A strong and vibrant cash market is a pre-condition for a successful and transparent futures market. Before the North American futures market originated some 150 years ago, farmers would grow their crops and then them to market in the hope of selling their commodity of inventory. But without any indication of demand, supply often exceeded what was needed, and not purchased crops were left to rot in the streets. Conversely, when a given commodity such soybeans were out of season, the goods made from it became very expensive because the crop was no longer available, lack of supply. In the mid-19th century, grain markets were established and a central marketplace was created for farmers to bring their commodities and sell them either for immediate delivery (spot trading) or for forward delivery. The latter contracts, forwards contracts, were the fore-runners to todays future contracts. In fact, this concept saved many farmers from the loss of crops and helped stabilize supply and prices in the offseason. Commodity Any product that can be used for commerce or an article of commerce which is traded on an authorized commodity exchange is known as commodity. The article should be movable of value, something which is bought or sold and which is produced or used as the subject or barter or sale. Indian Forward Contracts (Regulation) Act (FCRA), 1952 defines goods as every kind of movable property other than actionable claims, money and securities. In current situation, all goods and products of agricultural (including plantation), mineral and fossil origin are allowed for commodity trading recognized under the FCRA. The national commodity exchanges, recognized by the Central Government, permits commodities which include precious (gold and silver) and non-ferrous metals,

cereals and pulses, ginned and un-ginned cotton, oilseeds, oils and oilcakes, raw jute and jute goods, sugar and gur, potatoes and onions, coffee and tea, rubber and spices. Etc. Commodity market Commodity market is an important constituent of the financial markets of any country. It is the market where a wide range of products, viz., precious metals, base metals, crude oil, energy and soft commodities like palm oil, coffee etc. are traded. It is important to develop a vibrant, active and liquid commodity market. This would help investors hedge their commodity risk, take speculative positions in commodities and exploit arbitrage opportunities in the market Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities exchanges, in which they are bought and sold in standardized contracts. SILVER Silver is a metallic chemical element with the chemical symbol Ag (Latin: argentums, from the Indo European root * arg-for white or shining) and atomic number 47. a soft, white, lustrous transition metal, it has the highest electrical conductivity of any element and the highest thermal conductivity of any metal. The metal occurs naturally in its pure, free from native silver, as an alloy with gold and other metals, and in minerals such as argentite and chlorargyrite. Most silver is produced as a by-product of copper, gold, lead, and zinc refining. Silver has attracted mans fascination for many thousands of years. Ancient civilizations found silver deposits plentiful on or near the earths surface. Relics of these civilizations, include jewellery, religious artefacts, and food vessels formed from the durable, malleable metal. This metal took on near mystical qualities in marking important historical milestones throughout the ages, and served as a medium of exchange. The Mesopotamian merchants were doing just that as early as 700 BC.

In 1792, silver assumed a key role in the United States monetary system when Congress based the currency on the silver dollar, and its fixed relationship to gold. Silver was used for the nations coinage until its use was discontinued in 1965. The dawn of the 20th century marked an important economic function for silver, that of an industrial raw material. NEED AND IMPORTANCE OF THE STUDY The commodity market is still new and growing in India and it has a bright scope to develop, on that view this research study is taken. The Research main intention is to know the various price drivers that determine the price of SILVER. The main problem in the commodity market is the prediction of future price of commodity; especially prediction of price of global metals (gold) is very difficult. The future prediction will be made on the basis of the past response of commodity market to various price drivers. The price of gold and silver are highly affected by the various factors happening in and around the world. In order to know behavior of this to commodity to that factor, I referred past reacts of commodity market. OBJECTIVES OF THE STUDY 1. To learn about the Indian commodity market with reference to silver. 2. To study different price drivers affect the silver. 3. To find out how the price of silver fluctuates in Indian Commodity market 4. To interpret movement of future price of silver in commodity market. 5. To derive the relation of these commodities with other financial instruments. 6. To study the market characteristics of silver. SCOPE OF THE STUDY The scope of study shows the outer line or border of the research study. This study limited to only one commodity, i.e., Silver and this study is based on last one year performance of Silver and its related issues. This study relates to only Indian commodity market that is MCX, NCDX.

RESEARCH METHODOLOGY Research in common parlance refers to a search for knowledge. In fact, research is an art of scientific investigation. The Advanced Learners Dictionary of current English lays down the meaning of research as a careful investigation or inquiry especially through search for new facts in any branch of knowledge. For the preparation of the project report several method were used to collect data and pertinent information. The data required for the studies were collected is primary source. Detailed questionnaire were prepared for the different departments covering as many variables as possible. DISSERTATION TITLE ANALYSIS OF COMMODITY MARKET WITH REFERENCE TO SILVER SOURCE OF DATA Primary data Primary data is the data gathered for a specific purpose or for a specific research report for the first time or Data observed or collected directly from firsthand experience. Secondary data Data which are actually collected for some earlier research work and are applicable or usable in future research and which already have been passed through the satisfied process. The secondary data for this study was collected from the relevant journals, newspapers, and text books. The main source of secondary data for this project is internet source like MCX, NCDEX.

Tool used The live trading of last one year record system which is used in Edelweiss stock broking is used in this research to collect required data. Research design Research design is the conceptual structure within which research is conducted; it constitutes the blueprint for the collection, measurement and analysis of data. It is a plan for selecting of type of information used to answer the research question. It is a framework for specifying the relationship among the different influencing variables. Empirical research This research is done by using the empirical research design to analyze the performance and to study the silver on commodity market, by using all available data. Sampling design Sampling is simply the process of learning about the population on basis of a sample. Thus, sampling technique instead of every unit of the universe, only a part of the universe is studied and conclusion is drawn on that basis for the entire universe. A sample is subset of population units. I adopted the simple random sampling technique for the study. Simple random sampling Simple random sampling refers to that sampling technique in which each and every unit of the population has an equal opportunity of being selected in the sample. The study has adopted simple random sampling because population is known. Limitations of the study The following are some of the limitations of the study 1. The project work was required to be completed within a short period of time. So, time constraint was one of the main limitations of the study. 2. Most of the information is collected from secondary data, so researcher cant say it 100% applicable.

3. The samples i.e., calculations and figures are known only for a limited period. 4. This analysis will be holding good for a limited time period i.e. based on present scenario and study conducted, future movement of price may or may not be similar.

PLAN OF WORK
CHAPTER I CHAPTER-II CHAPTER-III CHAPTER-IV CHAPTER-V Introduction Profile of Edelweiss Stock Broking. Theoretical Concepts of commodity - Silver Data analysis and Interpretation Conclusions, Findings & Suggestions BIBLIOGRAPHY