Metals

Precious metals include silver, platinum, and palladium, and more. The best known of these metals is, of course, gold. In today’s trading world, it is possible to gain profits from a commodity, such as gold, without having to own the metal physically.

A gold CFD is a financial derivative that represents a theoretical order to buy or sell at least 10 ounces of gold. The turmoil in the financial market in recent years has turned a lot of traders' interests to speculating in gold. Gold has commonly been regarded as a safe haven during periods of financial turmoil. When there's any market calamity, you are likely to see an uptick in gold as it's considered as a safe haven, which makes it an ideal asset for hedging against these events. This is partly due to the perception that a commodity with intrinsic value will hold its value better than an investment in less tangible markets such as foreign exchange or shares, both of which can tumble sharply on negative economic data.

At FXGROUP100, you can use CFDs to gain leveraged exposure to precious metals. A gold CFD is a theoretical order to buy or sell a certain amount of gold, and the profit or loss on the CFD is determined by the change in the price of the gold. As it is a derivative, you never have to deal with taking ownership of the metal, but you can enjoy all the profits as if you had. The other advantage is that it costs you a fraction of the amount you would need to buy the gold.

Gold CFDs are amongst the most commonly traded, and hence one of the most liquid commodities you can trade and the advantage of this is that the spread is tighter, and you should be able to enter and exit positions easily irrespective of the trade size. Do keep in mind that gold is a very volatile market and daily trading ranges of $40.

The question is always to find the best way to make a trade that allows you to profit from your intuition of where the price is headed.

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