Effect of Financial crisis on price volatility of commodity market- Analysis and interpretation

Markets vary in form, scale (volume and geographic reach), location, and types of participants, as well as the types of goods and services traded. One of the classifications of markets is the International currency and commodity markets. Commodity market is a physical or virtual marketplace for buying, selling and trading raw or primary products. For investors’ there are currently about 50 major commodity markets worldwide that facilitate investment trade in nearly 100 primary commodities. Commodities are split into two types: hard and soft commodities. Hard commodities are typically natural resources that must be mined or extracted (gold, rubber, oil, etc.), whereas soft commodities are agricultural products or livestock (corn, wheat, coffee, sugar, soybeans, pork, etc.)

The study uses the facts and existing information for the purpose analysis statistical tools to test the hypothesis. The commodity prices of rice, petrol and diesel has been collected from April 2004 to September 2013 for comparing the prices before and during the crisis. The data been taken purely from the secondary sources from the journals and articles. The study finds out that the financial crisis is an unstable and dangerous situation which affects individual, group, community, or whole society. The economy must be very careful and cautious during this time. It not only affects one nation but can ruin the entire world.