Commodity Investing
Commodities are something produced for purposes of trade or commerce, and often they are things that are mined or agriculturally produced. Commodities have value, and are of uniform quality, that were produced in large quantities by many different producers. Commodity investing involves contracts and are traded on regulated exchanges.
Derivatives markets, part of commodity investing, will have participants enter into an agreement to exchange money, assets or some other value at some future date based on the underlying asset. Examples of assets could be anything from bars of gold, to a stock, or even an interest rate. A futures contract: an agreement to exchange the underlying asset at a future date. The exact terms of the derivative depend on the performance of that asset.
Commodity Exchanges
- Chicago Board of Trade
- Euronext
- London Metal Exchange
- New York Mercantile Exchange
Commodities Investing Examples
- Foodstuffs
- Livestock & Meat
- Fuels
- Precious Metals
- Industrial Metals
Written by Nagel on May 3rd, 2007 with
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