Trading with commodities is one of the most ancient trading instruments. A commodity is a basic good used in commerce that is interchangeable with other commodities of the same type. The sale is usually carried out through futures contracts. Commodities are traded not in shares but in contract sizes. Before a certain commodity can be traded on a capital market, its price and quality must be meticulously determined. You can buy and sell futures contracts at your convenience, without physically trading the raw material itself.
- Trading commodities often works as a hedge against inflation or unfavorable conditions of the market (e.g. a monsoon- if we’re talking about farming). Another example of a traded commodity is gold which can be used as a hedge in the event where a currency depreciates or an economy collapses.
- The most popular way to trade commodities is through a futures contract on a specialized exchange. The futures contract is an agreement to buy or sell an amount of a commodity at a specified time and price.
- By doing this, big businesses who use a certain commodity can protect themselves from disastrous price swings.
Trade Commodities to enjoy
|Symbol||Leverage (max)||Swap Long||Swap Short||Max Order Size||Size of 1 Lot||Spread||Trading Hours|
|USOil||1:100||-0,5263||-0,2167||20||1 000||floating||01:05 – 23:55|
|XAGUSD||1:100||-1,742||-1,045||20||2 500||floating||01:05 – 23:55|
|XAUUSD||1:100||-17,453||-2,493||20||100||floating||01:05 – 23:55|