Commodities
Commodities Trading
Trading Commodity is one of the most popular ways to
speculate in one of the most dynamic markets in the world.
What are commodities?
Commodities are known as the fundamental building blocks of the global economy.
They are natural resources traded on dedicated exchanges around the world.
There are two types of commodities – soft and hard. Soft commodities are typically agricultural like wheat or sugar, whereas hard commodities are metals or energies like gas, gold and silver.
The production and consumption of commodities depends on many factors, including:
- Economic and political events
- Supply and demand
- The weather
- The US dollar (commodities are normally priced in the US currency)
As a result of changes in one of more of these factors, prices of the commodity can fluctuate significantly, thou commodity prices are not as volatile as other asset classes which offers you Trading opportunities.
What is commodity trading?
Commodities trading is an enormous popular way to trade the financial markets.
The most common way for trading commodities is to buy or sell a futures contract. The price of a commodity futures contract is standardized, meaning the underlying instrument’s quantity (pound, ounce, barrel, etc.) is predetermined and appears the same for all market providers. A “futures contract” also obligates the holder to buy or sell a commodity at a predetermined price on a delivery date in the future.
Contract expires before the underlying future contract expiration day, eliminating the possibility of physical delivery.
Commodities are also generally traded as futures contracts. These are simply agreements to trade an asset at an agreed price and date in the future. This enables you to trade the contracts themselves without ever having to own the underlying asset.
In general, when bonds and stocks fall, the prices of commodities rise. Therefore, commodities can be used to hedge our portfolio.
Benefits of Trading Commodities with GapInvest
- Low Spreads – Trade with tight spreads and fast execution.
- Low Trading Cost – Clients can start trading with as little as $250.
- You are not charged with any commission, allowing you to reach maximum profit potential.
- GapInvest provides you leverage Trading so you can do more with less.
- Commodity can serve as a safe haven in global economic uncertainty and market instability, as they retain physical value.
- Free trading tools allow you to analyze situations better.
You can trade commodities such as precious metals, crude oil and natural gas among our range of trading products that will match your individual trading style and level of experience. Trading commodities is the perfect way to diversify your portfolio as commodity prices are generally less influenced by changes in stock markets.
How do I trade Commodities?
- Create an GapInvest CFD trading account
- Research a commodity you want to trade
- Decide how you want to trade long, short and strategy
- Take steps to manage your risk with setting the stop loss
- Open and monitor your position
Open Your GapInvest Trading Account
With GapInvest you can trade cryptocurrencies, indices, shares, currency pairs and more with ease. To apply for a live trading account, all you need to do is click the buttons below.