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What is Commodities Trading?

Read more about what commodities trading is, how to trade on commodities and discover a range of tips and strategies.

Trading on commodities is a way to speculate on the future price of a physical good such as gold, oil or cotton. Unlike the forex market, commodity trading itself takes place on structured exchanges where a relatively small number of buyers and sellers come together to agree prices.

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Whether spread betting or trading on commodity CFDs, you are trading on the underlying market price using a leveraged-based derivative product. Leverage means you can trade on larger positions than you could if you were to purchase the commodity outright. Leverage magnifies profits and losses.

Derivatives mean you can trade on the price without requiring to ever take delivery of the commodity – which it makes it possible for just about anyone to trade on commodities providing you have access to a phone or computer.

At ETX Capital you can trade on commodity futures and commodities with no expiry points.

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Commodities Trading?

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Existing Customers: +44 20 7392 1434

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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when spread betting or trading CFDs with ETX. You should consider whether you understand how spread bets orCFDs work and whether you can afford to take the high risk of losing your money.

Monecor (London) Ltd is a member firm of the London Stock Exchange. Authorised and regulated by the Financial Conduct Authority with Financial Services register number 124721.

The information on this site is not directed at residents of the United States, Belgium, Canada, Singapore, or any particular country outside the UK and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

In the unlikely event of ETX becoming insolvent, segregated client funds cannot be used for reimbursement to ETX Capital’s creditors. If we are unable to satisfy repayment claims, eligible claimants have the right to compensation by the Financial Services Compensation Scheme (FSCS), up to £50,000. If one of the banks ETX Capital uses to hold client money goes into liquidation then the losses would be shared by clients in proportion to the share of the money held with the failed bank. Funds lost this way may be compensated under the FSCS up to a limit of £85,000 per person.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.