Your Questions About How To Invest In Commodities

John asks…

How can i invest to commodity?

Jim Rogers

I watched this talkshow and interested to invest commodity.
Where is best place to invest for commodity?

John answers:

You can open an account with a commodities broker (Alaron Trading, Lind-Waldock), but you better know what you’re doing when it comes to commodities trading. The returns can be phenomenal, but so can the losses. In stocks, if you’re long, the losses are limited to how much you bought (stocks can only go to zero). If you are short, losses can be unlimited. With commodities, losses and be unlimited either long or short because of the high leverage.

Do your homework and study, practice, study more and practice more. It takes time. If you want to get more info on trading commodities, I would recommend the magazines “Futures” and “Technical Analysis of Stocks and Commodities”. You won’t find them in regular book stores, but Border’s Books carries them and I think Barnes & Nobles does also.

Ruth asks…

Invest in Commodity etf’s?

What are some ETF’s that I can invest in that track Coffee, Cotton, Etc?

John answers:

Broad commodity indexes and baskets are available via ETFs (GCC, GSG, DBC) and ETNs (UCI, GSC, DJP, GSP). There’s also a leveraged broad commodity ETF (UCD), a leveraged broad commodity ETN (DYY), and a double-short broad commodity ETF (CMD) and ETN (DEE).

Agricultural commodities include cocoa (NIB), coffee (JO), cotton (BAL) and sugar (SGG) — all ETNs. Agriculatural commodity baskets cover livestock (UBC, COW), grains (JJG, GRU), softs — ie. Coffee, cotton and sugar — (JJS), biofuels (FUE) and food (FUD). Broader agricultural indexes are also available via ETF (DBA) or ETN (UAG, JJA, RJA). Don’t confuse agricultural commodity ETFs/ETNs with ETFs which track the stocks of companies in the agricultural commodity business (CUT, MOO).

Industrial commodities include aluminum (JJU), copper (JJC), lead (LD), nickel (JJN) and tin (JJT) — all ETNs. Industrial metals baskets are also available via ETF (DBB) and ETF (UBM, JJM, RJZ). As with agriculture, ETFs are available which track the stocks of companies in the industrial commodities business (PKOL, KOL, SLX, HAP).

Oil is available as a simple long (USO, USL, OIL, DBO, OLO), leveraged long (UCO), short (SZO, DNO) and double short (DTO, SCO). There are also simple long ETFs for heating oil (UHN) and gasoline (UGA). Natural gas is available as an ETF (UNL, UNG) or ETN (GAZ). Energy commodity baskets are available as an ETF (DBE) or ETN (UBN, RJN, JJE).

Precious metals are available as baskets (DBP, PSAU) or individual metals. Gold is available as a simple long (GLD, IAU, SGOL, DGL, UBG), leveraged long (DGP, UGL), short (DGZ) and double short (DZZ, GLL) position. Silver, too, is available as a simple long (SLV, SIVR, DBS, USFV), leveraged long (AGQ) and double short (ZSL) position. Platinum comes as a simple long (PPLT, PTM, PGM) and short (PTD). Palladium comes only as a simple long (PALL). Like the other commodities, you can buy ETFs containing gold and silver related stocks — the gold miners and junior gold miners (GDX, GDXJ).

Sandra asks…

investment in commodity?

John answers:

Investing in commodities is very popular. EWI have a ‘Free Week’ going at the moment on their commodities forecasting service.

George asks…

Should I invest in commodities?

John answers:

I think the way gold and other commodities are performing one should capitalize on its growth. However, one should always keep in mind that the market is volatile and it is better to consult experts before investing. I would suggest you to download reports from Mansukh as it will help you in analyzing the trend and taking a better decision.
Best of luck

Lizzie asks…

When someone says they are invested in commodity, what it means?

Tell me the basic thing about my question.
To the first answerer : there is no site like that.

John answers:

Commodities are basic goods used in commerce that are interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. Quality may differ but essentially is uniform across producers. Exchange traded commodities must also meet specific minimum standards (aka basic grade).

In plain english, they are talking about oil, gas, corn, orange juice, metals, etc. Most often when we hear about commodities these days it is refering to oil or corn (due to the whole ethanol production thing). Check out the NYMEX (NY Mercantile Exchange) for more info on exact prices, etc.

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