Beginner Investing

A Commodity is anything for which there is a demand, but which is supplied without qualitative differentiation across a given market.

Commonly known as the futures market. This market enables you to purchase almost any commodity at the current market price and sell that commodity after a set time at the market price at that time.

Commodities include almost everything, metals, crops, foreign currency, meats etc.

For example if you could, with some certainty, predict the weather over the major grain growing areas of the world and knew that the harvest will be bad, then you may wish to invest in buying 10,000 tons of grain at today’s prices. Knowing that in six months time the price will soar due to shortages of gain and you can sell your 10,000 tons of grain at a hansom profit.

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