uTrade AlgosNo, Share India does not allow physical delivery of commodities traded through our platform. Instead, Share India offers cash settlement for commodity contracts, which is a common practice among many commodity traders.
Difference Between Physical Settlement and Cash Settlement:
1. Physical Settlement
- This involves the actual delivery of the underlying commodity from the seller to the buyer upon contract expiration.
- For example, if you have a contract for gold, physical settlement would mean receiving the actual gold bars.
- This process requires logistical arrangements for storage, transportation, and quality verification of the commodity.
- It is more complex and typically used by those who need the physical commodity for their business.
2. Cash Settlement
- This involves settling the contract by paying or receiving the difference between the contract price and the settlement price in cash.
- No physical exchange of the commodity takes place.
- It is a simpler and more convenient method, particularly for traders who are speculating on price movements and do not require the physical commodity.
- Most online commodity trading platforms, including Share India, utilise cash settlement.
In essence, physical settlement is for those who need the actual commodity, while cash settlement is for those who want to profit from price fluctuations.
For further assistance and queries regarding commodity trading through Share India, feel free to reach out to Share India’s support team:
- Phone: Call us at 18002030303 for quick support.
- Email: Drop us a message at support@shareindia.com.