Category: Commodities

Some of the weird widgets are making news today and surprising most of the people in America and rest of the world. What does it feels like when we hear the news” copper price is hitting the ceilings and is expected to move higher” or you read a news that talks about high cotton prices. We barely expect these commodities making news about their soaring prices. Consumers are finding it a daunting task to keep up with the growing oil price, rising grocery price and staggering price of every little and big things in the market. This is an indication that the commodity market is booking presently. The  prices in any market follows the path of a wave as it moves up and down like waves and the moment it hits the highest possible point, it starts falling immediately. This is the wave theory and taking reference from this theory it can be figured out that the commodity market will crash very  [...]

Indian commodity market has been affected by the ripples of disturbances originating from Japan. The trembling effect of tsunami has largely impacted the rubber prices, oil prices and also soybean. Such an immediate effect can lead us to think that a natural calamity in a country may lead to a catastrophe to another economy through the linkage of trade. But most experts of the commodity market refute this view. They feel that fundamental of a nation cannot be altered just by the devastation caused in the economy of the respective nation’s trade partner. Furthermore the experts say that the dented market supply Japan will soon get adjusted. If the energy supply shortage in Japan is a major concern then the neighboring countries will fill the gap through exports. Naturally this can bring back the nation to its previous level once again making the rest of the countries in the globe settle  [...]

For centuries now, gold has been a symbol of prestige, power and wealth. Ancient civilizations created gold jewelry as a form of ornamentation (as do we today) and even early forms of money were created from gold. Through millennia, our love for gold and precious metals remains as strong as ever and precious metals investing is as robust now as it has ever been. It has been attracting a lot of attention and rightly so. Precious metals will almost always retain their value irrespective of the economic climate that is prevailing. Some might go so far as to suggest that precious metals are the best investment you would ever make. But that is not true. But in these times of economic volatility, it is certainly a great investment to make. Gold is as popular as ever and it attracts major investment as always, but it should not be the sole focus of precious metals investing. There are other  [...]

Perhaps you’ve heard the phrase “an idle mind is the devil’s workshop”. Now, allow me to give you a bit of a twist on that old favorite. Here goes; “idle money is…”. Ok, fine…I don’t have a catchy saying for that. But you should know how to invest money and just as I don’t know how to finish that sentence, many people don’t know how to invest their money. Worse still, many don’t know why they should invest their money. Money should never be allowed to remain idle. A safe is a safe, and banks will always offer a sense of security. Heck, you might even get something negligible by way of interest. But that doesn’t mean an ordinary savings account is the way to go. Talk to any financial planner, and chances are he (or she) will tell you that “time is money” at some point or the other. What financial planners mean by that is that value and time have a causal connection.  [...]

Whenever a person or any entity spends money on an asset with the avowed intention of making a profit by doing so, the act is known as an investing. That asset could be movable or immovable but the argument remains the same; you must know how to invest money smartly in order to make the most of your money. The reason people invest is to grow their money, and at the very least match the rate of inflation. If you fail to do so, your money will be dwindling and lagging behind the growth curve. As such, investments can be made for the long or short term and any investment carries with it a certain risk factor. As well, some investments will guarantee you returns while some will not. That is just the way it is, and you must take this into account as well as several other factors when deciding on what to invest in. That’s because investment is vital for growing our money and knowing how to  [...]

Quantitative easing, for those that are not in the know (if you're one of them, which rock have you been stuck under?), is a program of massive asset purchases by the Federal Reserve. While needed to stimulate a flagging economy and while it is a popular decision, many analysts and economists are expecting it to increase the long-term risks of uncontrolled inflation and devalue the US dollar significantly. But say what you will, it is a necessary evil and there was no way the Federal Reserve was not going to do it. It is merely a question balancing out the long-term and short-term risks. Amongst the latter you can count deflation and a double-dip recession, and that was a far less palatable option to the risks posed by the long-term use of this policy. Since quantitative easing might ease short-term risks, it was always going to be implemented. But even in the short term, there are risks  [...]

Everyone loves the short term in today’s day and age. All fund managers are judged based on how they perform over a short period of time, usually 3 months, and television shows talk about stock markets in the here and now, most not even bothering to talk about the long term. And hedge funds measure time in milliseconds, investing one moment and disinvesting the next. Commentators pontificate long and hard into the night, maintaining that a history of markets is a history of waves in economies and markets that move in different directions at different times. Back in 1929, there was an investment adviser named Roger Babson who postulated that markets are driven by the third law of motion as stated by Newton; “every action has an equal and opposite reaction.” But then, this is the same person that wrote a passionate pamphlet with the catchy title, “Gravity—Our Number One Enemy”.  [...]

Even as stocks have taken a beating and experts expect this trend to continue, gold dust is in the air and everyone is smitten by it. Of late, gold has made a rip-roaring return in the books of buyers and this trend does not look like abating any time soon.  At about $1,230 an ounce, prices are 5% higher than at any other given point in the past few weeks and it shows no signs of easing up at all. Why the sudden gold rush? Curiously, gold has always been seen as the classic hedge in the face of inflation as it is a very tangible and very real asset as opposed to the value of paper currency. But keep in mind that several analysts are more focused on the possible fallouts of deflation as opposed to inflation and so the popularity of gold becomes all the more intriguing in the face of this. This is not to say that gold and inflation are tied hand in hand as it has been seen that gold prices  [...]

Commodity market is an inflation indicator of an economy, as it shows the price index of commodities. Hence, if you are planning to invest to hedge yourself against inflation, you must consider investing in this market. Commodity market can sometimes be quite volatile, but so can be the stock market. The idea is to diversify you investment in varied products, and into the ones not similar to your existing investment. You must expand your portfolio and allocate funds to various asset classes to minimize risk and get decent returns. The Market The commodity market comprises of 48 markets from all over the globe, and trades around 96 commodities. People can trade anything from gold, silver, coal to spices, stell and orange juice. One of the biggest commodities market in the US can be found in Chicago. Size of the market may be small. But Chicago Mercantile Exchange (CME) trades in big volume  [...]