Commodities Trading Guide

Commodities Trading Guide

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Traders and investors can gain exposure to commodities through futures contracts or through CFD trading on the most popular commodity exchanges. These instruments offer leverage which amplify your profit potential, but it’s important to use it wisely.

Commodities Trading Guide

A successful career in commodities requires a strong understanding of the supply and demand dynamics that drive this market segment. You also need to understand how to read a chart, as the data available in this market can reveal patterns that may indicate future price movements. Popular range indicators, such as the Commodity Channel Index (CCI), the relative strength index and stochastics, can help you identify overbought and oversold territory.

Commodities Trading Guide can learn how to trade commodities by grasping the basic exchange dynamics, selecting an efficient stockbroker, opening a trading account and crafting a strategic plan. NerdWallet writers are subject matter experts who draw on primary and secondary sources to craft informative articles. Our editorial process includes fact-checking and interviews with industry experts. We adhere to strict ethical standards and abide by the FTC’s investor education guidelines.

Hard commodities refer to natural resources that are mined, namely metals like gold (XAU) or energy markets like crude oil (CL) and Brent oil (BRN). Soft commodities encompass agricultural products like wheat (WKL), coffee (KC) or livestock like cattle (LE) as well as other materials like copper (HG). Investing in a commodity can diversify an investment portfolio, but it is important to understand the risks involved and know your own risk tolerance.

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Spread the love Traders and investors can gain exposure to commodities through futures contracts or through CFD trading on the most popular commodity exchanges. These instruments offer leverage which amplify your profit potential, but it’s important to use it wisely. Commodities Trading Guide A successful career in commodities requires a strong understanding of the supply…

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