NISM Commodity Derivatives In 2023: The Definitive Guide | NISM XVI- Karmanullify

NISM Commodity Derivatives:

NISM has launched this new certification course recently.

Who should apply for this certification?

This NISM Certification is best for sales personnel of trading members of stock exchanges and to pursue careers in brokerage firms dealing in commodity derivatives. Investment in commodities needs comprehensive research of the market indicators.

Such knowledge could be gained while preparing for this NISM Commodity Derivatives Exam wherein the latest updates, and the market reaction could be fully apprehended easily.

Commodity exchanges are self-regulating system and not like the stock trading. So, this certification knowledge is very crucial.

Benefit of NISM Commodity Derivatives Module And Commodity Trading:

The objective of this module is to provide beginners as well as the dealers with both theoretical and practical knowledge related to commodities trading.

And the actual benefit of commodity trading is that it gives you a lot of diversification in your portfolio. You could expanse out your risk model over many stocks and commodities. An ideal portfolio must always contain shares, bonds and commodities so that it makes it versatile.

Commodities such as gold, silver and oil are very popular Investment options for most retail investors in India. When we match the valuing of the commodities, they are less volatile than the stocks and bonds.

The investment in commodities can be done by knowledge of the demand and supply terms. The stock exchange gives you good transaction platform for dealing commodities between the buyers and the sellers.

How To deal In Commodities?

NISM Commodity Derivatives

NISM Commodity Derivatives Module trains the candidates with the knowledge and skills required for dealers in Commodities Market Module.

Previously, To deal in commodities, you require to apply to a brokerage firm in order to open a demo account for trading. A demo account, as the name applies, allows you with a prospect to trade by trial without placing your capital under risk. Although the account is actual, the capital in it is not real.

You can find out a lot about dealing in commodities by reading set of reports and monetary publications. There are many books on this topic, and you will also find both, weekly and daily, economic publications that concern in examining the commodities’ market in India.

After getting a Demo account, you require to apply to a brokerage firm to open an active trading account. However, before opening the account, make sure you have your PAN number and some identification proof like Aadhar, certificates and a photo.

An bank account is also needed in order to take out and deposit your capital from your active commodity’s trading account. There is a minimal necessity of deposit of Rs.5000. in your bank account in order to activate trading.

But due to recent technological advancement, the process is now very simple and not so time consuming like it was before.

After fulfilling all these conditions you can start dealing in the commodities. While trading, you might lose some capital, but you have to learn from your losses to become successful in trading.

Trading in Commodities in India could be done in the Following ways:

  • The National Commodity and Derivative Exchange.
  • The Multi Commodity Exchange of India Ltd.
  • The National Multi Commodity Exchange of India Ltd.

You could also get the help of the broker who is allowed to trade in the exchanges. Brokers that trade in stocks also have membership with the NCDEX and MCX. NCDEX is the Commodity Exchange which has developed this NISM Commodity Derivatives Module with the help of NSE.

Each broker has their own terms and conditions regarding the minimum investment required and margins rate. Previously, the minimum investment was around Rs.5000, and the margins normally range from 5-10% of the entire value of the commodity investment. You must also keep in mind that minimum investment will depend on the kind of commodity you invest.

To trade in commodities you need to open a bank account as well as a separate demat account in the National Securities Depository Ltd. You will also need a broker in order to transact the order. To open an account with the broker you will be asked to submit your PAN, bank account details and other forms for getting an account in your name.

The fee that is involved in commodity trading is brokerage and transaction charges. Previously, the brokerage will be somewhere around 0.10 to 0.25 per cent of the worth of the contract. Transaction costs will be between Rs.6 to Rs.10 per contract. The costs will change according to the commodities and will never go beyond the maximum limit.

But, now Discount Brokers brokerage and transaction charges are very low. And due to recent technological advancement, the process is now very simple and not so time consuming like it was before.

NISM Commodity Derivatives Study Material:

Study Material for NISM Commodity Exam is available for NISM aspirants to download free of cost from NISM portal while registration.

You can buy Nism XVI workbook from Amazon or you can get previous edition of Ebook of NISM XVI from here free of cost.

NISM Commodity Derivatives Module And Units:

Sr. No.Units/Chapter
1.Introduction to derivatives.
2.Commodity Derivatives.
3.Application of Futures and Options.
4.NCDEX platform.

NISM XVI Details :

Registration Fee for this module : 1800 Rs.
Exam Duration is around 2 hours.

Mode of exam is online.
There are around 100 questions in this Examination just like other NISM Modules.
There is no negative marking for incorrect answers.

Passing marks for this module 60 marks.
Just like other NISM certificates, this certificate is valid for 3 years from the test date.

NISM Commodity Derivatives Mock Test:

We have created this mock test for NISM which will help you to get great score. We have provided explanation for each question so that one can learn even while solving. This sample mock test is completely free and are very precise and up to date.


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#1. SEBI regulates banks

SEBI regulates Stock market while RBI regulates banks in India.

#2. if you bought 20 contracts in futures and then sell 5 contracts from the same account , then how many contracts are left?

As you bought 20 contracts in futures and then sell 5 contracts from the same account then (20-5= 15) contracts are left only.

#3. In derivative market we trade in lot size while in cash market we trade for shares.

In derivative market we trade in lot size while in cash market we trade for shares.

#4. Shreya bought 1000 shares of a company at Rs 50,000 with face value of Rs.10. And company declares 100% dividended. Then calculate Dividend yield

Dividend received by shreya = face value x shares bought = 10 x 1000 = Rs 10,000

Formula of Dividend yield  for 100% dividend declared = Dividend Received / Amount Invested x 100 = 10,000/50,000 x 100 = 20 %.

so, Dividend yield is 20%

#5. Company XYZ Ltd have inventory of Rs 50,000. Calculate sales of XYZ Ltd over the last year if average age of inventory is 30 days.

As mentioned, average age of inventory is 30 days. So inventory turnover ratio= no. of days/ average age of inventory= 365/30 = 12.16 times.



  • Inventory Turnover = sales/ inventory
  •   12.16 = sales/50,000
  • Sales = 12.16 x 50000
  • Sales = Rs 6,08,333


#6. Calculate the EPS of XYZ Ltd by using the data given here : face value = 10 , Equity capital = Rs. 20,00,000 and Net profit = Rs. 90,00,000.

Given : face value = 10 , Equity capital = Rs. 20,00,000


No. of shares =  2000000 / 10 = 200000

Earning per share of XYZ Ltd = 9000000 / 200000 = 45


Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing. Please read the Risk Disclosure documents carefully before investing in Equity Shares, Derivatives, Mutual fund, and/or other instruments traded on the Stock Exchanges. As investments are subject to market risks and price fluctuation risk, there is no assurance or guarantee that the investment objectives shall be achieved. Past performance of securities/instruments is not indicative of their future performance. This post is only for Educational purpose.

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