Since multi-leg strategies require a good understanding of derivatives and careful sizing of positions, they may not be something that many traders will choose.
Above all else, you will need a platform which is able to handle the complexity without introducing any inconvenience to the process.
A spread consists of two or more legs, while a combination strategy can include several strikes and different expiries.
Carrying out each of these steps one at a time introduces a timing risk, since the market could have moved by the time you place the second or third part of your strategy. As a result, a strategy which seemed profitable in theory might end up being worthless.
What is required for multi-leg trading is a solid platform which is able to manage several orders, display the Greeks and the Profit & Loss (P&L) of the different legs in real time and at the same time keep an eye on your exposure through appropriate risk management tools.
Here are some of the best platforms for multi-leg commodity trading in India –
Groww
Groww holds the position of being the biggest player in the Indian commodity derivatives market when measured by notional average daily turnover, having a market share of 28.6 per cent. The extent of its operations results in highly active and liquid markets which allow your multi-leg strategies to be carried out efficiently.
Advanced traders have access to a variety of commodity derivatives based on gold, silver, copper, aluminium, zinc, nickel, natural gas, crude oil and electricity on MCX and NSE.
This is how Groww makes trading easier for multi-leg strategy traders –
- You can place several order legs at once using Basket Orders, thus eliminating the timing risk associated with manual execution.
- You can continuously assess the total sensitivity of your multi-leg position by using the option Greeks such as Delta, Gamma, Theta and Vega which are built into the system.
- Carry out a pre-trade analysis on a variety of instruments using more than 100 technical indicators, drawing tools and customizable layouts across multiple timeframes.
- Because of the order management feature similar to OCO, all related orders will be automatically adjusted when one of the legs is triggered.
- You can manage risk on each individual leg by using target-based exits, stop loss orders, cover orders, and bracket orders.
- Keep an eye on your real-time exposure for all of your open positions by using live tracking of your P&L and margin utilisation.
- Efficiently plan your rollovers by using the Expiry Calendar to manage your contracts over a number of legs.
- Use market scanners, current quote prices, market depth information, and your own custom watchlists to find opportunities for employing multi-leg strategies.
- Keep slippage low across several legs. Execute trades quickly in 20 milliseconds (0.02 seconds).
- You can track and adjust your positions from anywhere using the perfect web and mobile experience.
- After making a trade, review your strategy using the P&L analysis, your trade history and the downloadable reports.
- You can find out more about trading strategies and commodity markets by referring to the educational blogs and the dedicated YouTube channel.
Make the cost of trading on a number of legs predictable by paying a flat brokerage rate of ₹20 for each order that is executed.
Recommended for: Traders who are experienced and highly active and who wish to carry out multiple-leg strategies at the same time and who expect to have real-time Greeks and position monitoring.
Dhan
The platform is designed with the requirements of active derivatives traders in mind and offers them commodity derivatives in respect to gold, silver, nickel, zinc, copper, crude oil, and natural gas on MCX.
Large positions can be divided into smaller ones using order slicing in order to handle multi-leg entries without causing market impact.
- Reduce the time between developing a strategy and putting it into action by having a system that enables rapid placement of orders.
- The platform provides a range of tools that are focused on options in order to enable you to manage your positions efficiently.
- It is possible to monitor the total exposure by using live tracking of the profit and loss figures and bracket-style orders.
- With its responsive and sophisticated charting capabilities you can carry out pre-trade analysis over various timeframes.
For commodity F&O, brokerage is set at ₹20 per executed order.
Most suitable for: traders who are active in the derivatives market and who need quick, structured ways of placing orders for complicated multi-leg positions.
Zerodha
The structured multi-leg execution feature of Zerodha’s Kite platform applies to commodity derivatives on MCX, including gold, silver, crude oil, natural gas, and base metals.
Decrease the need for manual execution by combining several legs with basket orders.
- The stop-loss remains automatic for all positions when cover orders are used, which makes it easier to manage risk in multi-leg trades.
- Stability is maintained when the sessions are volatile and it is not acceptable for there to be delays in the execution of the strategy.
- A clean interface makes it easier to make decisions when dealing with several open positions at the same time.
- Varsity covers multi-leg derivatives concepts in depth for traders developing their strategy knowledge.
The brokerage charge for commodity derivatives is either ₹20 for each executed order or 0.03 per cent, whichever of the two is less.
Most suitable for: traders looking for support with respect to basket orders and needing platform stability when carrying out a structured multi-leg strategy execution.
Upstox
Upstox provides the facility to trade commodity derivatives on MCX, including gold, silver, crude oil, natural gas, and base metals.
- It is possible to set the entry, stop-loss, and target for each leg in one continuous process using bracket orders.
- Carry out a multi-leg pre-trade analysis using technical indicators and advanced charting on various timeframes.
- You can monitor price action for a number of different instruments at the same time by using live market data and depth.
- A clean interface makes order management simple over the course of complicated sessions.
The brokerage fee is twenty rupees for each executed order on commodity F&O.
Ideal for: Traders who want a quick and slim interface so that they can manage a number of commodity derivatives positions at the same time.
Angel One
On MCX, traders are able to carry out trading in commodity derivatives, including those for gold, silver, crude oil, natural gas and the base metals.
- Bracket orders and stop-loss options enable the risk to be specified for each leg.
- The research and trading ideas available in-house are useful for providing the market context needed when developing multi-leg strategies.
- The system provides live tracking of positions and details regarding margins, giving a clear view of the total exposure across all positions.
- The mobile app allows for full execution and monitoring to be carried out while on the move during active multi-leg sessions.
- Technical indicators and the more advanced charting tools allow for pre-trade analysis with regard to a number of assets.
The brokerage for commodity F&O is ₹20 for each order that is executed.
Most suitable for: traders who build their strategies through research and carry out active multi-leg executions.
5paisa
Through MCX, 5paisa provides the facility to trade in commodity derivatives, including gold, silver, crude oil, natural gas and base metals.
- You can manage multi-leg commodity trading together with other segments in a single account.
- In a multi-leg setup, place stop loss orders on each of the individual positions.
- Watchlists and live market data facilitate price monitoring among different instruments
- Web and mobile platforms that offer both trading and position monitoring capabilities.
The prices are based on a subscription model, and this can reduce the cost per order since multiple-leg strategies involve carrying out several trades and have a higher frequency of orders.
Most suitable for: traders who want to manage multiple-leg commodity positions spanning different asset classes at low brokerage fees and a low cost per order.
ICICI Direct
You can trade commodity derivatives on MCX, such as gold, silver, crude oil, natural gas and base metals.
- Improve your control over your positions by setting different stop-loss levels and targets for each leg.
- Access in-house research and market reports to fine-tune your multi-leg trading strategy
- Current users of ICICI Bank can more easily manage margins on various trades.
- The use of advanced charts and technical indicators will help you keep track of price movements and in formulating your multi-leg strategy.
The amount you pay for the brokerage service will depend on the plan you choose and is generally more than what most discount brokers charge.
Final Thoughts
In order for a platform to efficiently carry out multi-leg commodity derivatives strategies, timing, the Greeks, the combined exposure and margin management all need to function together.
Groww meets the criteria that are most relevant to multi-leg traders; in addition to enabling the simultaneous execution of orders via Basket Orders, it also keeps an eye on exposure across various legs by providing real-time P&L tracking, assesses the sensitivity of positions using its built-in Option Greeks, and organises the orders using OCO-style management. Moreover, the
At a speed of 20 milliseconds on both the MCX and the NSE, the infrastructure provides the level of accuracy needed by multi-leg strategies.
Groww provides comprehensive solutions for the difficulties faced by commodity traders who use a multi-leg strategy.