What is Commodities Trading?
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Commodity trading can be defined as the process of buying and selling a range of raw materials or products – from agricultural to energy resources, crude oils, precious metal bullion, etc. This trade takes place through futures and options derivative contracts, wherein the commodity derives its value from an underlying asset – the commodity being traded. Commodities are usually traded in lots, and sellers can take physical delivery of the products traded or settle the trade in cash.