Trading Commodities

A commodity is a product that is sold without differentiation by all suppliers. Although any good or service can be a "commodity" if it is sold by many suppliers in an undifferentiated fashion, the term commodity generally refers to physical goods which are the building blocks of more complex products, and which are traded on commodities exchanges such as the Chicago Board of Trade (CBOT) or the New York Mercantile Exchange (NYMEX). Some examples of commodities include iron ore, crude oil, sugar, soybeans, aluminium, rice, wheat, gold and silver.

Investing in commodities is done primarily through the trading of futures contracts.

Contents

• 1 Futures Contracts vs. Spots
• 2 Delivery Dates
• 3 Ticker Construction
  • 3.1 Elements of a Commodities Futures Ticker
  • 3.2 Examples
• 4 Prices
  • 4.1 Commodity Prices are Heavily Inter-Connected
  • 4.2 Commodity Prices have Immense and Far-Reaching Impact on the Economy as a Whole
  • 4.3 Commodity Prices are Dependent upon Global Currency Values
• 5 Commodities Today
  • 5.1 Commodities Boom
• 6 Commodities on Wikinvest