commodity
Definition 1
A physical substance, such as food, grains, and metals, which is interchangeable with another product of the same type, and which investors buy or sell, usually through futures contracts. The price of the commodity is subject to supply and demand. Risk is actually the reason exchange trading of the basic agricultural products began. For example, a farmer risks the cost of producing a product ready for market at sometime in the future because he doesn't know what the selling price will be.
Definition 2
More generally, a product which trades on a commodity exchange; this would also include foreign currencies and financial instruments and indexes.
A physical substance, such as food, grains, and metals, which is interchangeable with another product of the same type, and which investors buy or sell, usually through futures contracts. The price of the commodity is subject to supply and demand. Risk is actually the reason exchange trading of the basic agricultural products began. For example, a farmer risks the cost of producing a product ready for market at sometime in the future because he doesn't know what the selling price will be.
Definition 2
More generally, a product which trades on a commodity exchange; this would also include foreign currencies and financial instruments and indexes.
This content can be found on the following page:
... #63 on our list of the most popular terms.
... an essential investing term.
Related Terms
Commodity Trading Advisor, backwardation, contango, contract, crop year, daily trading limit, derivative, grade, deliverable grades, intercommodity spread and
commodity appears in these other terms
commodity paper, Commodity Futures Trading Commission
Loading...
| |
Get our content on your iGoogle page
RSS