Mumbai, India: With a message to spread awareness among common people about using the commodity derivatives market, a World Investor Week full of awareness events and programmes came to an end this Sunday. India’s leading commodity derivatives exchange, National Commodity & Derivatives Exchange Limited (NCDEX), under the guidance of the securities market regulator, the Securities and Exchange Board of India (SEBI) organised these programmes with full fun fare in different formats to attract more and more audience from tier-2 and 3 cities across around a dozen states.
World Investor Week is observed every year under the aegis of the International Organization of Securities Commissions (IOSCO). SEBI is the national coordinator for WIW in India and conducts investor education and awareness activities in collaboration with stock exchanges, and depositories. This year the campaign focused on investor resilience and sustainable finance apart from making a call to follow progressive financial and trade practices.
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The key objective during the week was to reduce investor vulnerability and educate them about their rights and responsibilities. The awareness drive focused on the usage of commodity derivatives as a tool to enhance the health of their agricultural output and drive awareness about price discovery, the options and the exchange physical settlement mechanism. Awareness about the quality of crops accepted by the NCDEX and how farmers can maintain the same was created through various communication channels. Along with them, awareness about Investors Do’s & Don’t, creating understanding regarding quality and assaying standards, creating awareness about eNWRs (Electronic Negotiable Warehouse Receipts), banks and financial institutions was also covered during different programmes.
Arun Raste, MD & CEO, NCDEX said, “Although this Investor Awareness Week is an annual affair, it has a lot of significance in helping commodity markets its due. Indian commodity derivatives are in a nascent stage, and we need more such campaigns to bring the right messaging to the common people that commodity derivatives markets are also worth looking at when they plan their finances. Apart from the asset class concept, commodity derivatives are almost unavoidable for the value chain participants to manage their price risk. But seldom do they know it. Such campaigns play an important role in setting the record right.”
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The campaign was launched at five locations – two in Maharashtra, two in Rajasthan, and one in Telangana, by flagging off the Krishi Rath which covered 23 locations during the week. Krishi Rath is an FPO (farmer producer organisation) outreach initiative through a mobile van where exchange representatives interacted with local farmer leaders, FPOs, and other stakeholders in the physical mandi to raise awareness about commodity price risk management through commodity derivatives. Apart from the Krishi Rath yatra, Investor Education Programs (IEPs) and Investor Awareness Programs (IAPs) were also organised. While IEPs at 35 locations hosted around 2,100 farmers, FPOs, Exchange members and VCPs (value chain participants), more than 2,000 students and police personnel participated in IAPs at another 35 locations.
The anchor campaign was focused on physical value chain participants, hence key mandi locations were identified to host awareness activities under the campaign banner of ‘Commodity Ka Tyohaar’. During this event, 23 mandis in seven states were adorned with radiant lighting and decorations and 1350 people participated in them. NCDEX officials participating in the campaign actively engaged and interacted with the local mandi traders, FPOs, processors and stockiest present at various connection points, along the Rath Yatra, IEP venues, or mandis during Commodity Ka Tyohar.
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This was the third year in a row that ‘Hack the Risk,’ a Pan-Indian industry-academia event was held during World Investor Week. It gave college students a chance to share their thoughts on the significance of risk management. A total of 153 teams, each comprising three students registered out of which six teams successfully made it into the finals and three finally emerged as the winners.
All of the initiatives that were planned in seven states focused on educating different types of stakeholders about the pitfalls they were exposed to in the commodity market due to price volatility. NCDEX played a significant role in providing a one-stop solution for hedging price risk via futures, options, and indices because all risks, including weather risk, product risk, policy risk, and others, are reflected in the price of the commodity.
