Commodities and Trading Opportunities

New_Ser_Ngmi · 2026-01-05T16:45:43+00:00

Commodities are the primary raw materials in agriculture and industry, divided into heavy and light categories. They can be traded through various channels such as futures contracts, providing investors with options to build their portfolios.

New_Ser_Ngmi

2026-01-05 16:45:43

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What Are Commodities?

In the financial markets, commodities include raw materials used in agriculture and various industries. These materials are often sold in large quantities through wholesale channels rather than retail. Trading commodities is not limited to holding the physical goods directly; most transactions occur through financial instruments such as futures contracts, where traders agree to buy or sell the commodity at a predetermined price on the contract’s expiration date.

Main Categories of Commodities

Commodities can be classified into two main types based on their nature and origin:

Hard Commodities (Hard Commodities) are natural resources that require extraction or mining from the earth, including:

Energy: Crude oil, natural gas, and other energy products
Metals and Minerals: Gold, silver, copper, aluminum, and other valuable minerals

Soft Commodities (Soft Commodities) originate from agriculture and livestock, which are cultivated or raised, including:

Agricultural Products: Wheat, corn, sugar, coffee, and other crops
Livestock Products: Meat, milk, and other animal products

The diversity of commodities provides investors and traders with numerous options to build portfolios or hedge their asset values.

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