Difference between Commodities & Stocks
|1.||Stocks are investment to a company||Commodities entail immediate Consumption of products for domestic and industrial purposes|
|2.||Stocks are financial instrument for Investment; it’s not tangible in nature.||Commodities are tangible in nature and can be consumed|
|3.||Stocks allow one take over ownership in a company||Ownership of commodities is passed between sellers and buyers.|
|4.||Buying and selling of stocks involve the brokers||Traders are involved in buying and selling of commodities|
|5.||Stocks are traded in stock exchange market||Commodities are traded in the commodity exchange market|
|6.||Stock came into existence through issuing processes||Commodities often come into existence through the production process|
|7.||The return on stocks is known as dividend||The return on tradable commodities is known as profit.|
1a: Define the term “Commodity exchange”
b. What are the benefits derivable from commodity exchange?
c. List at least three requirements for trading.
2a. Define tradable commodity
b. Mention three types of tradable commodities
3. Outline and explain six roles of commodity exchange in economic development.
4. Write short notes of the followings
a. Spot trading
b. Quality control
c. Open entry
d. Electric trading
e. Soft commodities
5. Identify four major constraint of trading in commodities.