Commodities refers to a market that trades in agricultural products, livestock and meat, as well as metals (i.e. non-ferrous metals, steel, iron ore) and energy (i.e. crude oil, coal). Prices usually follow basic economic concepts, with a reduction in supplies leading to higher prices and a glut, to lower prices. Ruizean Markets provides a flexible and easy way to participate in some of the world's most popular commodities trading, including energy and precious metals, which can be traded on our MT4 platform.
The commodities market has attracted a large number of speculators, because the volatility between supply and demand causes sharp fluctuations in prices. Unlike trading in futures contracts, trading commodities, also known as Contracts for Difference (CFDs) does not require physical delivery of the product, but are virtual trades.
Commodity trading has a long history and can be traced back to the Chicago Mercantile Exchange, which was founded in 1898. Ruizean Markets customers can now enter into one of the most liquid, but volatile commodity markets, with the use of leverage.
Characteristics of Commodities Trading
- Does not require any long-term delivery fees.
- Does not require physical delivery of any commodities.
- All transactions can be performed digitally over the internet.
- You can trade the FX, commodities and the stock index on the same account
|Standard Account||Pro Account||ECN Account|
|XAU/USD||35 pips||30 pips||6.0 pips|
|XAG/USD||35 pips||30 pips||4.0 pips|
|USO/USD||6.0 pips (100 barrels contract)||6.0 pips (100 barrels contract)||5.0 pips (100 barrels contract)|
|UKO/USD||6.4 pips (100 barrels contract)||6.4 pips (100 barrels contract)||5.4 pips (100 barrels contract)|
|Examples of gold trading|
|Spot gold is currently trading at 1305.00 / 1305.50|
|You decide to buy a gold price of 1305.50 contract (100 ounces)|
|An hour later, the spot gold trading at 1320.00 / 1320.50|
|You decide the price of 1320.50 to close your position|
|Your profit = (1320.00-1305.50) * 100|
|Net profit = $ 1450|
More and more people use commodities as alternative investment transactions, however most of the time they have no proper understanding of the complex commodity markets. This lack of understanding leads to financial losses, due to the volatility of the market. Since the commodity market is so volatile and complex, it is important for investors to learn some of the strategies and techniques required in these markets, before entering into day trading. It is also beneficial for potential investors to review all of the available trading tools, helping them to make the most of profitable opportunities.