Not going to be a long post today, I just thought I'd mention something that I've left out thus far.
When you are trading currency like I have described, you are undertaking what is known as 'Futures Trading'. This is basically the speculation of a price moving up and down in the future.
Did you know however, that Forex is not the only thing you can trade? Let me introduce you to COMMODITIES.
Commodities are goods you see in everyday life, things that make the world economy go round. Rather than anticipating price movements of a currency in relation to one another, with commodities you are speculating on the price movement of just that item.
Examples of commodities? Oil, gold, sugar, cocoa, soya beans and live cattle!
Is it not amazing that you can trade such items without actually ever possessing them physically?
You use information that you have gathered to make predictions on price movements, similar to the methods you use in the currency market. Let's talk about cattle.
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| 10 points if you remember this guy |
The price of live cattle has a lot to do with demand and supply, as well as personal income. If corn or soya beans (used to feed the cattle) change in price then this will have an effect on the price of cattle. The weather can also have an impact. If its cold, cows may waste energy by trying to keep themselves warm, and thus will weigh less - which then impacts the price they are traded at. Also, if personal income increases, the demand for quality beef also increases.
It's interesting how so many forms of information are included in the price of commodities. The individual who is able to disseminate this information and use it to anticipate price movements can make a lot of money.
Look at a full list of traded commodities here (frozen concentrated orange juice?!)
Which commodities would you like to see traded?
Which commodities would you like to see traded?
Thanks for reading,
Jr
www.twitter.com/jr_dot
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