Published 20 July 2026 · By the PCJ Desk · about 7 min read · General educational information, not investment advice.
The Multi Commodity Exchange (MCX) is India’s largest commodity derivatives exchange. It lets you trade futures (and options on some commodities) in bullion, energy and metals — a way to participate in commodity price moves or hedge exposure. Because commodity derivatives are leveraged, they carry real risk and need understanding before you start.
What trades on MCX
Bullion — gold and silver (and smaller contracts like Gold Mini, Gold Guinea). Energy — crude oil and natural gas. Base metals — copper, zinc, aluminium, lead. Each has standardised lot sizes and expiry cycles set by the exchange.
How commodity futures work
A futures contract is an agreement to buy or sell a fixed quantity of a commodity at a set price on a future date. You do not pay the full value — you post a margin (a percentage), so gains and losses are magnified relative to your outlay. Most retail positions are squared off before expiry rather than taken to physical delivery.
Margins, lot sizes and timings
SEBI and the exchange set the initial margin per commodity; volatile commodities need more. Lot sizes are fixed (for example, a full gold or crude lot represents a large notional value, which is why mini contracts exist). MCX trading hours run into the evening (typically to around 11:30 pm, extended to 11:55 pm in daylight-saving months) to track global markets. Confirm current margins, lots and timings on MCX.
The risks to understand first
Leverage cuts both ways — a small adverse move can wipe out your margin. Commodities are driven by global cues (dollar, geopolitics, supply shocks) and can gap overnight. Use position sizing and stop-losses, never trade money you cannot afford to lose, and treat tips promising “sure profits” as a red flag.
How to start
Activate the commodity segment on your trading account (an income proof is required), fund your account, and start with small positions. You can enable it while opening an account or add it later; learn the mechanics in PCJ Academy — Commodities.
Frequently asked questions
Do I take physical delivery of gold or crude?
Usually no — most retail traders square off before expiry; delivery is optional and follows exchange rules.
How much money do I need?
Enough to cover the exchange margin for at least one lot plus a buffer; mini contracts lower the entry size.
Is commodity trading riskier than equity?
Leverage and global sensitivity make it higher-risk; it needs discipline and risk management.
Where PCJ fits. PCJ Holdings is a SEBI-registered stock broker and NSDL depository participant, headquartered in New Delhi and serving investors across Delhi NCR since 2006 — with a dedicated relationship manager, one account across equity, F&O, commodity, currency, mutual funds, IPOs and wealth products, and transparent charges. Open an account or talk to an RM.