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UnxCapital

Commodities Trading

Commodities trading represents the buying and selling of quantity sets of homogeneous and near-homogeneous assets. Popular commodities include the West Texas Intermediate (WTI), Brent Crude Oil (XTI), Gold (XAU) and other precious metals, and soft commodities such as Wheat, Coffee, Cocoa, Soya etc. Price movements in commodities are relatively slow and are usually seen as bellwethers and market indicators for the overall health of the industry that produces and consumes them.

Types of Commodities

  • Hard commodities: Refers to natural resources that are mined or extracted
  • Soft commodities: Agricultural products or livestock
  • Metals: Includes precious metals such as gold, silver, platinum, palladium and copper
  • Energy: Crude oil and natural gas are the main energy products that are traded. Heating oil, gasoline and electricity are among others
  • Agriculture: Agricultural commodities are centred around staple crops and animals. Wheat, rice, corn, soybeans coffee are among the most common crops. The classification of animals includes livestock and meat such as live cattle, pork, and eggs.
  • Livestock and Meat: Eggs, Pork, Cattle and more
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    What Are the Most Traded Commodities?

    The most traded Commodities are those which have an established market of buyers and sellers. This translates to high levels of liquidity and lower trading costs - two of the main attractions when trading Commodities CFDs.

  • Gold: Of the precious metals, gold continues to lead the way. Throughout history, gold has been a valuable commodity. The gold standard was in operation for almost a century and central banks continue to hold gold reserves. It is easily transferable for cash and often used as part of a hedging trading strategy as it often trades opposite to the United States dollar (USD).
  • Other Metals: Silver, platinum and palladium are among the most traded commodities. As they are considered a safe-haven investment, there is a wide range of Trading Strategies Using Precious Metals.
  • Crude Oil: The widespread use of oil makes it one of the most in-demand commodities. Petrol and diesel are examples of refined oil which highlights its importance in all forms of transportation. Its value as a source of energy is the reason why oil prices are heavily scrutinised.
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    Why Trade Precious Metals with UnxCapital?

    Margin Trading:

    As CFDs are a leveraged product, you can open large positions by depositing only the margin required. As metals such as gold have high levels of liquidity, commodities trading offers higher levels of leverage than many other tradable instruments.

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    Go 'Long' or 'Short':

    One of the main attractions of CFDs is the ability to speculate in both rising and falling prices. The ability to open short positions and benefit from falling prices is a unique aspect of CFD trading and one that creates additional trading opportunities.

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    Risk Management:

    Advanced trading platforms such as MetaTrader 5 and MetaTrader 5 offer excellent risk management tools. Their features include a large range of charting tools but also a multitude of order types and alerts to ensure that you are made aware of any changes to market conditions.

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