In this section, you will find information about ETFs, commodities and example articles on which you can trade online via CFDs. It should be noted right away that although gold, oil and natural gas ETFs are also commodity ETFs, we wanted to create a separate section in order to include articles dedicated to commodities in general. But what are commodity ETFs? Raw material ETFs are particular types of funds that differ from commodity mutual funds. ETFs contain securities of companies in a given sector and are listed and traded just like equities. The Exchange Traded Funds dedicated to the commodities sector are precisely the commodity ETFs, which can be mainly agricultural, food, energy.
Oil Commodity ETF
Oil is the most traded raw material when it comes to ETFs. In fact, it attracts investors and traders for several reasons, including its high volatility, which allows the more tenacious to exploit it in order to achieve more important results in much less time than other financial products. The same applies to natural gas ETFs, a raw material that is very much related to the price of oil. It should be noted, however, that ETFs are funds that include baskets of securities of companies in a given sector (in this case, the production of oil or gas). The price of oil itself, or its futures, is not the main factor to consider when valuing ETFs.
Agricultural Commodity ETF
Agricultural commodity ETFs include those Exchange Traded Fund funds dedicated to agricultural commodities. These can include, for example, cotton, coffee, corn, which represent some of the most traded and requested agricultural commodities on the market.
Food Commodity ETF
Often categorized separately but in reality, with Food ETF often refers to agricultural raw materials. The only difference is that while some of these can be used for other production cycles or for food raw materials, we refer only to those grown and harvested for food purposes, usually for humans. Some raw materials, for example, are used to feed farmed animals.
How to trade commodity ETF online
To trade commodity ETFs, you can proceed by actual subscription by visiting the administrator’s website or by using CFDs. Please note that CFDs are much more practical, much less expensive and allow you to trade online from home or wherever you are on your mobile device. CFDs are financial instruments that passively replicate the price of an underlying asset. Commodity ETF CFDs will, therefore, see a quote equal to that of the ETF, to which you will add a small percentage of the spread (the only form of gain by the broker). CFDs are leveraged financial instruments. For this reason, it will be possible to trade on a much larger number of ETFs than would be possible using the traditional methods for the same budget. For CFD trading you can also trade with micro-capital. With the CFD trading offered by Plus500, the risk is limited to the deposited capital. However, in order to reduce risk, we recommend that you visit our Stop Loss article as part of our CFD course. With Stop Loss orders the trader or user can set a maximum loss percentage through an order to the software platform that will automatically close the position at a loss once the “alert” level has been reached.
List of Commodity ETFs
Below you will find articles dedicated to commodity ETFs of various kinds. We remind you that in case you are looking for information about ETFs Oil, gas, gold, silver, you can find them starting from the menu item dedicated to ETFs and then choose the desired commodity.
Commodity Index Fund DBC