How we work?
Commodities markets allow producers and consumers of commodity products to gain access to them in a centralized and liquid marketplace.
These market actors can also use commodities derivatives to hedge future consumption or production.
Speculators, investors, and arbitrageurs also play an active role in these markets.
Certain commodities, such as precious metals, have been thought to be a good hedge against inflation, and a broad set of commodities as an alternative asset class can help diversify a portfolio.
Because the prices of commodities tend to move in opposition to stocks, some investors also rely on commodities during periods of market volatility.
In the past, commodities trading required significant amounts of time, money, and expertise, and was primarily limited to professional traders. Today, there are more options for participating in the commodity markets.
COMMODITIES SINCE EVER
TRIBAL CLANS
FOR CENTURIES
FOR CENTURIES
Trading commodities goes back to the dawn of human civilization as tribal clans and newly established kingdoms would barter and trade with one another for food, supplies, and other items.
FOR CENTURIES
FOR CENTURIES
FOR CENTURIES
The rise of empires such as ancient Greece and Rome can be directly linked to their ability to create complex trading systems and facilitate the exchange of commodities across vast swaths via routes like the famous Silk Road that linked Europe to the Far East.
THE PRESENT
FOR CENTURIES
THE PRESENT
Today, commodities are still exchanged throughout the world—and on a massive scale. Trading has also become more sophisticated with the advent of exchanges and derivatives markets. Exchanges regulate and standardize commodity trading, allowing for liquid and efficient markets.