This is an interesting type of investment as it is often used by more experienced investors as a hedge for stock market operations (as is the case, for example, in the Stock Market and Metals Investment Strategy). Obviously, the kings in this section are Gold and Silver.
Typically, investment in metals is divided into two major groups:
Such as Gold, Silver and Platinum.
Such as Copper, Palladium and Aluminium.
This is a group that allows us to invest in a wide variety of financial assets. In general, only the most advanced investors tend to operate with them, as it requires great knowledge of the derivatives markets (Futures, Options, CFDs and Warrants). However, there is also an easier way to invest in these markets, which is to allocate part of our capital to buy an ETF specialised in this sector.
I am not going to enter into the debate on whether it is ethical or not to engage in speculation in the commodities markets, as there are opinions to suit all tastes. The idea here is only to reveal the existence of this type of investment and my aim is not to encourage food trading. Every adult should be able to make his or her own decisions.
M. P. Agricultural:
Such as Corn, Wheat and Rice.
M. Perishable P. P:
Such as Cocoa, Coffee and Sugar.
M. P. Livestock:
Such as Cattle, Pigs and Dairy Cattle.
This is actually also a type of commodity investment. However, due to the very particular properties that characterise it, it is best to clearly separate it from agricultural and livestock. Here the king is oil, an asset widely used by experienced traders. However, it is not the only energy commodity available for trading and we can also work with other assets such as Natural Gas, Gasoline and Heating Fuel.
In general, we are talking about investments with high volatility. This characteristic makes them very appealing to expert traders and, at the same time, not very recommendable for beginners and even intermediate level investors. They are two sides of the same coin… Having seen the first typologies of the list, next day (in a new post) we will finish looking at the main types of investment. Let’s remember that, as we said at the beginning, the following are still pending: Real Estate, Bonds, Short-Term Fixed Income, Alternative Investments and Money Deposits.