Beginner Commodities Tutorial
Beginner
What is a Commodity?
Commodities are fundamental goods used in commerce that are interchangeable with other goods of the same type. They serve as the building blocks of the global economy, functioning as raw materials for various industries and contributing to the production of finished goods. Commodities can be categorized into two main types: The prices of commodities can […]
Lesson 1 of 10 | 5 Min
Beginner
How do you trade Commodity CFDs?
Trading Commodity CFDs involves speculating on the price movements of various commodities without owning the physical assets. By using CFDs (Contracts for Difference), traders can profit from fluctuations in commodity prices without the need to hold the actual commodities. To start trading Commodity CFDs, you need to open an account with a broker that offers […]
Lesson 2 of 10 | 0 Min
Beginner
Choosing a Trading Platform
A trading platform is crucial software for executing trades, analyzing markets, and managing your account. When selecting a platform for commodity CFD trading, focus on a user-friendly interface, dependable performance, and access to essential trading tools. Popular choices include MetaTrader 4 (MT4), MetaTrader 5 (MT5), cTrader, and TradingView, which are well-regarded for their extensive features. […]
Lesson 3 of 10 | 5 Min
Beginner
When can you trade commodities
Trading Commodity CFDs can occur nearly around the clock, closely mirroring the trading hours of the underlying commodity markets. Commodity futures, which serve as the foundation for many of these CFDs, are generally available for trading almost 24 hours a day. Major exchanges like the Chicago Mercantile Exchange (CME) and the Intercontinental Exchange (ICE) […]
Lesson 4 of 10 | 5 Min
Beginner
Liquidity & Volatility
Liquidity refers to how easily a commodity can be bought or sold in the market without significantly affecting its price. High liquidity indicates a large volume of trades, allowing traders to enter and exit positions quickly and with minimal price slippage. For Commodity CFDs, liquidity varies depending on the specific commodity being traded. For example, […]
Lesson 5 of 10 | 0 Min
Beginner
Pips & Lot Sizes
Pips (percentage in point) are the smallest price movement that a commodity CFD can make based on market convention. In the context of commodities, a pip typically represents a change in price. For instance, if gold (XAU/USD) moves from $1,800.00 to $1,800.10, that 10-cent movement represents 10 pips. Pips are essential for measuring price changes […]
Lesson 6 of 10 | 5 Min
Beginner
Leverage & Margin
Leverage is a powerful tool in trading that allows traders to control a larger position with a relatively small amount of capital. In Commodity CFD trading, leverage is expressed as a ratio (e.g., 1:50, 1:100), meaning that for every $1 you have in your trading account, you can control up to $50 or $100 worth […]
Lesson 7 of 10 | 5 Min
Beginner
How to Choose a Commodities Broker?
Choosing the right commodities broker is essential for a successful trading experience. Here are some key factors to consider when selecting a broker for trading Commodity CFDs: Regulation and Reputation: Ensure that the broker is regulated by a reputable financial authority. Regulation helps protect your funds and ensures that the broker adheres to strict financial […]
Lesson 8 of 10 | 10 Min
Beginner
Demo vs Live Trading
Demo trading allows traders to practice their trading strategies in a risk-free environment using virtual money. This feature is essential for beginners as it helps them familiarize themselves with the trading platform, test various strategies, and understand market dynamics without the risk of losing real funds. Most brokers offer demo accounts that simulate live market […]
Lesson 9 of 10 | 0 Min
Beginner
Risk Management
Risk management is a critical aspect of successful trading, especially in the volatile commodities market. Here are essential risk management strategies to consider when trading Commodity CFDs: Set a Risk Tolerance Level: Determine how much of your trading capital you are willing to risk on each trade. A common guideline is to risk no more […]
Lesson 10 of 10 | 0 Min