Key Differences between Equity vs Commodity

*Key Differences between Equity vs Commodity* 

Both Equity vs Commodity Card are popular choices in the market; let us discuss some of the major Difference Between Equity vs Commodity

• Equity shares are generally listed and traded in stock exchanges like National Stock Exchange and Bombay Stock Exchange etc., while Commodities are getting listed and traded on the stock exchanges like Multi Commodity Exchange, National Commodity and Derivatives exchange etc.

• Equity Markets are less volatile as trades can be undertaken even in a single share, while commodity markets are highly volatile as trades are conducted in huge lot sizes.

• Equity markets are less risky as low volatility is there, the Commodity market is highly volatile as a result of the same these are highly risky.

• Equity contracts have no expiry dates, while commodity contracts have always fixed expiry date on which settlement must take place.

• Equity contracts require an investment of market price only, while commodity contracts require an investment of margin requirement which keeps on changing based on the changes in the price.

• Equity market comparatively has a high amount of liquidity as compared to commodity market as investment happens in the lot size

The holder of the equity instruments is considered as the owner of the company, hence it enjoys all the privileges like dividend, voting right etc. However, such privileges are not available with the holder of the commodity instruments.