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The glossary
Commodity

A basic good or primary agricultural product used during a production process, interchangeable with other goods of that same type, such as coal, oil, grains, gold, etc. Commodities are traded in small or large quantities through the spot market (cash) or derivatives as futures or options. The commodities market is highly standardized, and commodities are often used to protect investors against inflation.

Investor Corner

The Chicago Stock Exchange is the oldest commodities exchange in the world. The price variation in commodities highly influences the price of food in the world. As commodity prices tend to increase in a period of high volatility, they are considered a refuge investment.

Anecdote

If you don’t want to face the surprise of actually receiving the ounce of gold you traded through a future delivery, make sure you do not miss the expiry date of the futures contract.

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