Commodities
Commodity trading represents the buying and selling of a wide range of instruments, including oil, gas, gold, silver, cocoa, coffee, wheat, sugar, etc
Commodity trading is as old as humanity is. Back to Amsterdam in 1530, you can find the first example of an organized exchange for trading commodities.
These days offer a large variety of markets available to trade on with a few clicks, but still commodities remain as popular as ever.
Oil, Gold, Wood, Coco beans and more, commodities are basic goods which are, no matter who produces them, universally similar. Gold from Russia is the same as Gold from the South Africa, just like oil from the United States can be refined to fuel a car just like oil from Iran. Commodities are ordered through Futures Contracts, which are basically agreements to deliver a set amount of a certain good at a set future time. These contracts can be, in turn, traded before the due date.
How to trade commodities
2 Decide to buy or sell
Buy (go long) if you think prices will go up, or sell (go short) if you believe prices will go down.
3 Decide on the amount per point movement
Decide with what amount of capital you will open your positions with, or how many units (CFDs) you want to trade. If you choose CFDs keep in mind that the value of one unit depends on the instrument you've decided to trade.
4 Manage your risk
Guaranteed stop-loss orders(GSLO) technically does the same as regular stop-loss orders, with a single difference, GSLO needs a premium, which promises to close you out of a trade at a price you specify regardless of market volatility or gapping.
5 Monitor your position
It is crucial to monitor your positions after you placed them (including any stop orders or take profits). You are all the time following your real-time profits or loss. You have to keep in mind that losses can exceed your deposits.
6 Close your position
Close your trade when you are ready, if your trade is not automatically closed.
