People trade different kinds of assets, such as stocks, options, futures, derivatives, and commodities. Each has a different strategy of trading and suggests others on what is suitable, according to them. But, new investors forget that each investment goal and objective differs from another. They cannot suit everyone. People also have varying levels of risk and investment criteria, which affects their returns and interest rate.
Trading a commodity means facing constant fluctuations in price compared to stocks. Hence, they have higher volatility, which gives traders ample opportunities to enter and exit the market and cash in on price movements.
The risks are higher, too.
• Do not enter the trade with stock market ideas
• Diversify the capital
• Understand the logistics
• Use specific technical analysis methods
• Understand the difference between cyclic and non-cyclic commodities
• Use the volatility trick like taking positions and determining the lot size
• Study the market before taking a bullish or bearish position
• Follow specific tricks for specific commodities
• Follow the basic trading rules