How to Buy Commodities in Zerodha?

“Buy crude oil, it will reap great results”, have you heard of such statements and felt intrigued to trade in commodities with Zerodha commodity account? If yes, then here we are with the complete detail on how to buy commodities in Zerodha. 

Zerodha is one of the best stockbrokers in the country and it is better because you can effectively start trading in commodities as well. Commodities include various agri and non-agri products and is traded only in the futures and options segment. 

So, let’s begin with detail of segment activation and trade-in commodities in Zerodha Kite. 

How to Enable Commodity Segment in Zerodha? 

Does Zerodha commodity trading fascinate you? If so, then you should open a Zerodha commodity trading account and start making the profit that you deserve.

But the question here is, do you need to follow some extra procedures to buy commodities in Zerodha. The answer is yes! 

You need to activate your account using the following steps. 

• Log in to the Zerodha Console, after your Zerodha demat account is opened. 

• Now, select activate segment under the commodity tab. 

• Now you will have to enter the income range, the classification of commodity trade, and your trading experience. 
• You will now have to upload an income proof and then provide the password. 
• Now e-sign the document and then you will be redirected to the NSDL website, where you will enter your aadhar number. Enter the OTP received and your segment will be activated in the next 48 hours.

An additional charge of ₹100 will be charged on activating the commodity segment in Zerodha. 

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How to Trade Commodities in Zerodha?

Once you activate the segment, the next question in the line is how to buy commodities in Zerodha. 

For this, one must first be aware of different types of commodities as there are agri commodities include corn, rice, beans, cotton, and much more. The non-agri commodities include metals, energy, and also livestock, and meat. 

Although, there are various commodities to buy in Zerodha, but the traders generally show their interest in trading some specific commodities as discussed below. 

How to Buy Gold Commodity in Zerodha?

Gold is one of the most popularly traded commodities in the market. There are various factors that draw traders towards the gold commodity and one being its demand amongst the traders. 

Note- The lot size of gold commodity is 1 kg.   

If you want to buy the gold commodity in Zerodha, then you can follow the given steps. 

• Log in using your login credentials. 
• Now, in the search tab search for gold commodity. After this, you will see various futures and options with their dates. 

• Choose the one that you want to trade in. You can also use the option chain for a better understanding of the trade. (Zerodha has an integrated Sensibull option chain for advanced features)
• Now fill in the quantity and the order type. Click on the buy button. 

Your order will get placed successfully. 

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How to Buy Crude Oil in Zerodha?

Crude oil is another popular commodity amongst commodity traders. The high potential of making profits and its international reach makes it one of the top-rated commodities. But how to do crude oil trading in Zerodha? For this check the information below. 

The lot size of crude oil is 100BBL. This means that when you purchase 1 quantity, you are purchasing 1 lot and it has 100 BBL. 

• You can easily log in to your Zerodha commodity account using your client ID and password. 
• Once you have successfully logged into your demat account, you will see the search bar where you can easily search for the crude oil commodity. 
• A list of various futures and options will appear. FUT is for the futures, CE for call options, and PE for the put options. 

• Now click on the one that you wish to trade-in. 
• You can further take the help of the option chain as well when you want to analyze the trade properly. 
• Once you have selected the desired strike price and date, you will see a buy window. 
• Enter the necessary details like quantity, order type, and then click on buy. 

Your order will be placed successfully. 

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How to Buy Silver in Zerodha?

Similar to gold and crude oil, silver is also one of the most traded commodities in the commodity market. Let us quickly go through the steps of how to buy non-agri commodities like Silver in Zerodha. 

The lot size for silver is 30kgs. 

• Log in using your credentials and then on the search bar, search for the silver commodity. 
• Now choose the desired strike price and the desired option. 
• Now a buy window will pop up. Enter the order type and quantity and then click on the buy option. 

Your buy order for the silver commodity will be placed successfully. 

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Zerodha Commodity Charges 

Just like other stockbrokers, Zerodha also levies some charges, including the brokerage when you trade in the commodity segment.

To start commodity trading, the broker imposes Zerodha commodity account charges including the account opening fees equals to ₹300. But if you already have a Zerodha demat account you can activate the commodity trading in Zerodha by paying ₹100.

In all these are the Zerodha commodity account charges along with the brokerage fees. Here are the details:

Zerodha Commodity Brokerage Charges

Since Zerodha is the discount broker and thus it imposes flat fees to trade in commodities.

However, the taxes differ as per the commodity (agri or non-agri) you choose to trade.

The detail of the brokerage fees imposed for commodity trade in Zerodha is given in the table below:

 

 Note-You can only trade commodities in futures and options and not the equity segment.  

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Zerodha Commodity Margin 

Is the worry of commodity trading being expensive ringing your head as well? It is obvious that whenever there is a talk of futures and options, the topic of margin accompanies.  

Once you have a Zerodha trading account and want to do commodity trading, you will be required to maintain an NRML margin that varies for different commodities. This is the margin that you need to maintain so that you can hold the commodities overnight. 

Of this NRML margin, you need to maintain the 20%, and the rest 80% is provided by the broker. This has to be maintained because, in futures or options, you have to trade in the upcoming time so that broker has to make sure that the amount is recovered when the market conditions don’t work in your favour. 

The approx NRML margin for the above-mentioned commodities is as follows. 

 

Now that we have seen how to do commodity trading in Zerodha, let us have a quick look as to when can you purchase or invest in commodities. The trading hours differ from the equity market and are given below.

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Commodity Trading Time in Zerodha 

Till yet we learn about how to trade in commodities in Zerodha, but now another question that trails behind is till when.

Generally, the commodity trading time is longer than the normal equity segment and further varies according to the commodity you are trading in.

Check out the detail of commodity trade time in the table below:

 

Also, your positions will be auto-squared off 25 minutes before the closing time.

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Conclusion 

Commodity trading can be a hustle at times, but when you analyze, monitor, and then trade accordingly, this hustle can be turned into a pleasurable experience. If you were looking for some answers related to how you can purchase commodities in Zerodha, then we hope that your quest ended here. 

If you want to start commodity trading then open your demat account today and have a great experience. 

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Start commodity trading now by opening a demat account online for FREE!

 

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