INVESTOR PERCEPTIONS TOWARDS COMMODITIES MARKETS: A STUDY WITH SPECIAL REFERENCE TO CHENNAI CITY
Abstract
India's commodity trading market is positioned as one of the most major and growth-oriented markets globally. It is a key factor in driving the economy and offers investors great opportunity to broaden their investment portfolios. Currently, both the government and business organizations in the country are employing their most talented individuals to establish a reliable and effective commodity trading market. A commodity market is a marketplace where investors engage in the trading of various commodities, such as spices, energy, precious metals, and crude oil, inside a certain country. Recently, the Forward Market of Commissions in India has enabled the trading of approximately 120 commodities through futures contracts. In 2024, it is anticipated that the nominal value in the Commodities market for India will reach US$998.30bn. The predicted compound annual growth rate (CAGR 2024-2028) is expected to be 1.00%, leading to a total projected sum of US$1,039.00bn by 2028. The commodity market is a significant and enduring component of the financial sector in every country. Various products such as precious metals, basic metals, crude oil, energy, and soft commodities like palm oil and coffee are traded in this market. Developing a dynamic, energetic, and fluid commodity market is crucial. Investors are seeking to allocate funds in the commodity market, although they lack knowledge on investment strategies and the related risks. A comprehensive perception study can aid in formulating policies and raising knowledge among potential investors regarding commodities markets, hence fostering the emergence of a dynamic market in the future. The present study aimed to ascertain the factors influencing the behavior of commodity market investors and their investment decisions among individual investors in Chennai city. The findings suggested that investor behavior is strongly correlated with the economic profile, awareness, investment market atmosphere, regulatory protection, and active participation in encouraging commodity market investments through reliable and stakeholder protection standards and supervision. The primary factors that have the most significant impact on investment decisions, in order of importance, are the risk tolerance of individuals, awareness of commodity market investments, investment attitude, and behavior of independent investors. These factors are observed to have coefficient values of 0.332, 0.315, 0.224, and 0.168, respectively. This suggests that the investors are exercising greater caution when making investing decisions. Each investment relies on the individual's capacity to tolerate risk and their knowledge of a specific investment opportunity. The sensible investors' trustworthy and long-term investment selections are a favorable indication that the markets will see sustainable growth.
Keyword : Risk- Sustainability- Market trends-operating mechanism-Rural network
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