Commodity and equity are the medium of investments made. Where as commodity deals the underlying value of the asset\products like agri products and non-agri products which are not physically traded but traded through contracts and equity deals on the investment made on the shares sold by the registered company to be a part on ownership of the share in the business.
The major differences of commodity and equity are
- Commodity is traded in MCX (multi commodity exchange of India pvt ltd) and equity is traded in NSE OR BSE.
- Liquidity in equity investment is higher than commodity investment.
- Equity investment is for longer duration where as commodity is invested to earn profit within a short term.
- The equity investor has the right and obligation to buy and sell the owned shares where as in commodity the buyer or seller has only right but no obligation.
- The investment is preferred on the demand in case of commodity and the performance of the company in case of equity.