Engery & Agriculture are naturally occurring materials or objects that are collected and processed for use in human activities. Since raw materials are needed to create food, energy and clothing, they are the foundation of any economy. Engery & Agriculture are usually mass-produced and standardized in quality and quantity, and are used as raw materials to create new products.
According to the definition previously provided, the commodity category includes a wide range of product categories for which branding is not a consideration. However, investors often have a narrower perspective. When using the term "commodities" for investment purposes, they are referring to a group of basic items that are in high demand around the world.
The types of Engery & Agriculture you can invest in
Investing in engery
Engeries are usually items that are extracted from the ground. Energy resources are materials that we extract from the earth and use to power it. Here are some more examples of engeries:
Gas
Oil
Investing in Agriculture
When we use the term "Agricultures" we are referring to the products we harvest or grow. In other words, agricultural are different types of crops. To make it clearer, here are some examples of agricultural:
Food products: coffee and cocoa
crops: sugar and cotton
Wha is the advantage of trading Engery & Agriculture?
Investing in engery and agriculture can add tremendous value to your trading portfolio and help you realize better returns. Here are the main reasons why:
You can diversify your portfolio through Engery & agriculture.
Investing in engery and agriculture can be a risk management strategy. Unlike bonds and stocks, engery and agriculture have low or negative correlation with other markets. Therefore, even if other traded products perform poorly, it is possible to move in the opposite direction of the other engeries and agricultures, giving you the opportunity to increase your returns.
Investing in Engeries & Agricultures can help you against inflation
As the only certainty in the market is uncertainty, you need to use instruments that can help you combat extreme events such as inflation. Engeries & Agricultures can be a great tool in this regard. Because they are a tangible asset, they maintain their value as the cost of goods and services rise.
Engeries & Agricultures can be profitable
Engeries & Agricultures prices are affected by a variety of factors such as supply and demand dynamics, geopolitical events and natural disasters, so they can be volatile over the long term. If their prices go up, traders can open positions to buy them. If they go down, traders can open positions and sell them for a good investment opportunity.