What are commodity futures?

Commodity futures are agreements to purchase or sell commodities like food, oil, or any other raw materials at a future date at a specific price. Get to know the trading process of commodity futures.

Can you buy a commodity on the futures market?

They can be traded on the futures market, where parties agree to buy or sell commodities at a certain time, and for a certain price, in the future. You can also purchase commodity exchange-traded funds, or ETFs, or commodity stocks. In fact, commodities act as a natural hedge against inflation.

How do commodities futures work?

As commodities futures trade on an open market, they correctly determine the price of raw resources. They also predict the future worth of the commodity. Traders and their experts decide the prices. They investigate their particular commodities all day and every day.