Want to learn more about commodities trading? Than you are at the right place. Here you will learn more about commodities and CFD’s, as well as you can compare the different platforms. A CFD is a contract for difference. If you sell silver after it rises to 1,100 dollars, you will collect the profit.
Commodities trading with a limited investment
A CFD allows you to trade raw materials, commodities, like sugar, silver, gold, oil, sugar, platinum, etc. To put it simply: commodities are the raw materials that people use to create a livable world. With CFD’s you can trade this commodities with a limited investment.
Generally commodities meet the following criteria:
- Tradability: the commodity is tradable. This means there must be a viable investment vehicle to help you trade it
- Liquidity: a commodity has an active market with buyers and sellers. Liquidity is critical, because this gives traders the option of getting in and out of an investment
- Deliverability: a commodity is physically deliverable. For example: oil can be delivered in barrels and wheat can be delivered by the bushel.
Benefits of commodities trading
- Leverage: Thanks to the leverage effects, traders can enter into a CFD contract with a limited investment
- Profit in falling and rising markets
- Diversification: CFD’s gives traders an opportunity to trade in different markets and instrument, including commodities
- No underlying ownerships
- No commissions: the brokers earning money on the spread between the bid and ask