Personal Finance & Money Stack Exchange
Personal Finance & Money Stack Exchange

Questions tagged [commodities]

For questions related to commodities, commodity trading, etc. For specific trading questions, consider using a specific tag as well, e.g. futures, options, etc.

Gold is a prime example of a commodity, because all gold of the same karat rating is considered essentially the same, regardless of origin. Coffee is another example of a commodity, because although arabica and robusta, the two main species of coffee that underlie futures contracts, do differ, within species the financial markets treat them as identical.

139 questions
109
votes
5 answers

What does it mean for the price of oil to be negative?

The New York Times website currently has this graph, showing that the price of "West Texas Intermediate, May contract" is $-13.10. Does it literally mean that someone's offering $13.10 to take a barrel of oil off their hands, or is it a quirk of…
Mark
  • 1,316
  • 3
  • 12
  • 15
40
votes
3 answers

Why not invest in precious metals?

I have been considering a mix of precious metals in my portfolio; mostly gold, but also some silver, platinum, and palladium. I'd like to hear some arguments why this would be a bad idea given present conditions and outlook in the long run.
user123124
  • 1,085
  • 1
  • 9
  • 13
39
votes
8 answers

Why do gas stations charge different amounts in the same local area?

I've noticed there can be a 5%-10% difference in the price of gas where I live. For example right now the cheapest premium price is $3.85 and the most expensive is $4.17. It's the same state and county, and the product being sold is considered a…
Vik David
  • 627
  • 2
  • 7
  • 11
32
votes
10 answers

Could I make money off of the negative oil price?

The price of oil went negative around 1 PM Eastern time. You could get paid to take oil off the field. Is there a way to flare oil offsite without safety risks? Could we drive nonstop on the highway just to burn gasoline in order to get paid at the…
Number File
  • 493
  • 1
  • 4
  • 5
21
votes
1 answer

What's funny about "He leveraged his @#% deep into soy beans and cocoa futures" in The Jerk (1979)?

Near the end of the comedy The Jerk (1979), a character explains how their family got rich: Father: All I did was take the money you sent home and embarked on a periodic investment, in a no-load mutual fund. Taj: He leveraged his ass deep into soy…
Atomic Tripod
  • 821
  • 4
  • 9
20
votes
3 answers

How can I invest in gold without taking physical possession?

I want to buy gold but I do not want to physically store it. I just want to invest in the price of gold. Where can I buy electronic gold certificates? Something like putting money in the bank but instead of dollars, I'm depositing gold, for example.…
user4951
  • 1,063
  • 5
  • 13
  • 25
20
votes
3 answers

What happens if I do not honor a futures contract?

I have little knowledge about futures contracts. The recent negative price of crude oil spurred my curiosity about this stuff. I read this post about buying/selling futures contracts. According to this post, when I buy a futures contract, I enter…
William
  • 373
  • 1
  • 2
  • 6
19
votes
3 answers

How to buy commodity on exchange (to use)

I was always wondering: How do you buy a commodity (for example oil or aluminum) on an exchange for a "real" purpose. It seems like most resources on the net deal with how to "trade" them in a broker's account and speculate on prices. But what if…
NoRyb
  • 445
  • 4
  • 9
13
votes
6 answers

Why does money value normally decrease?

When you save money in the bank, you expect interest on your investment. But if you invest, on, say property, gold, or other durable goods, you don't expect your house or gold to multiply. Why? Is it because the value of money almost always…
Fitri
  • 533
  • 2
  • 5
  • 6
12
votes
3 answers

Is it practical to take actual delivery on a futures contract, and what is the process?

Usually people trade futures speculatively, ie. they buy and sell contracts without actually delivering the goods. However, technically the futures are contracts for delivery of a certain amount of goods. Can't you then simply buy a gold futures…
Superbest
  • 2,688
  • 3
  • 19
  • 25
12
votes
6 answers

What intrinsic, non-monetary value does gold have as a commodity?

Clearly the main focus of discussion of gold is on its extrinsic value - the value placed on it by investors and others who prize it as a store for wealth. However, it's conceivable that society could one day be in a state where gold is no longer…
Lorenzo
  • 393
  • 3
  • 10
11
votes
7 answers

Is there a general guideline for what percentage of a portfolio should be in gold?

I have some gold (GLD), but not much - a little over 1% of my net worth, and about 2% of my non-retirement investments. I'd like to increase this position as an inflation hedge and to have something that is less correlated with the market as a…
Jer
  • 2,974
  • 6
  • 29
  • 37
11
votes
2 answers

What does it mean to invest in potatoes?

There is an amusing thread on Reddit where people discuss what they would do with an unlimited supply of potatoes: http://www.reddit.com/r/AskReddit/comments/37yawp/you_have_an_almost_infinite_supply_of_potatoes/ Some of the comments discuss…
Dai
  • 1,867
  • 3
  • 15
  • 27
11
votes
5 answers

Pros & cons of investing in gold vs. platinum?

I'm considering moving some of my investments into physical precious metals in case the world economy tanks further. Both gold and platinum are near historical highs, but platinum has been more volatile. What are the pros & cons of investing in gold…
Joir
  • 119
  • 4
9
votes
3 answers

Is it possible to take advantage of the current low market by buying financial instruments connected with oil/natural gas?

I was really hesitant to ask this question, but based on the reception of this other question Good investment options to take advantage of current low market I hope this one won't be off-topic. Also a premise: as it will be abundantly clear from my…
DeltaIV
  • 717
  • 1
  • 6
  • 15
1
2 3
…
9 10