Commodity trading is one of the most viable and profitable trading options available to investors all over the world today. It is an excellent way to build wealth with great options to help diversify your portfolio rather than focusing only on traditional securities.
But, many people do not understand the commodity market or how to get a stake in it. Commodity trading is often dreaded and seen as a field too complicated to invest time and resources in.
While commodity trading may not be the simplest trading option available, it is not complicated to learn or master. In this article, we give you a quick but comprehensive look into what commodity trading is and the best ways to learn commodity trading that will get you well on your way to begin building wealth.
Table of Contents
- Best Commodity Trading Courses
- What Is Commodity Trading?
- What to Study to Become a Commodity Trader
- What Are the Top 5 Traded World Commodities?
- What Makes a Good Commodities Trading Course?
5 Best Commodity Trading Courses
Outlined below are five of the best places you can turn to for commodity trading courses.
Shaw Academy: Commodities Trading Course Online (Best for Learners Who Want to Learn on Their Own Time)
Shaw Academy is an online training platform providing free and premium courses for people seeking to develop business-related skills. It was founded in 2013 and has since seen a rapid explosion in popularity globally. Shaw Academy currently offers a 4-part course on commodity trading.
Learning Outcomes:
- A clear understanding of commodity trading as well as risk management
- Strong and confident ability in technical analysis
- Reading and reacting to price action
Standout Features:
- Classes are not live, but they are scheduled by the hour so you can pick the best time for when you to take the course
- Shaw Academy also has great analytic support on the course.
Benefits:
- Test your knowledge. You can test your knowledge of what you learn with tests and exams available for each module.
- Learn at your own pace. Because of the busy schedules we have, learning commodity trading gets easier with Shaw Academy’s paced learning program.
- University approved. You can earn a university-approved certification when you complete the course.
Downsides:
- Diplomas come with extra fees.
- You must take the exam and pass it to receive the certification.
Pricing:
The first four weeks are usually free but afterward, pricing typically ranges from $60 and up.
Duration:
The course covers 32 modules spread out over 16 weeks.
Udemy: Commodity Trading With Trading Strategies Course (Best for People Looking for a Flexible and Affordable Course)
Udemy is an open online course provider, with great video, audio, and text lectures. The platform has since become one of the most popular online learning platforms with a vast range of courses and training available to all. A great mobile app experience also takes learning on Udemy to a different level. Udemy offers several courses on commodity trading and its derivatives.
Learning Outcomes:
- Correlation among the commodity, bond, and stock market
- Basic concepts for trading gold, natural gases, copper, silver
- Understanding derivatives
- Basics of commodity trading
Standout Features:
- Mobile app makes learning portable
- Video, audio, and text lectures are available as well as exams to test your knowledge
- Certification of completion given at the end of the course
Benefits:
- There are several commodity courses available on Udemy, so you can cover a lot of ground on commodity trading.
- You can download the courses for offline studying on the app which offers a great learning experience on the go.
- The course grants lifetime access to the on-demand videos offered
Downsides:
- There is an expansive range of topics covered in this course, you may need to take additional courses if you want to hone in on a specific topic
Pricing:
This course is priced at $89.99 but can often be found on sale. Currently it is discounted to be $13.99.
Duration:
15.5 hours
Corporate Finance Institution: Introduction to Commodities (Best for Beginners Who Want a Strong and In-Depth Take on the Market)
Corporate Finance Institute (CFI) offers professional certification courses for personal and corporate finance studies. The organization was created by top industry professionals with experience in investments, commerce and trade, and corporate training. The CFI course on commodity trading provides a strong and extensive dive into the industry for intermediate level traders.
Learning Outcomes:
- Define commodities and their key features
- Identify the major commodity categories and the key drivers
- How to trade commodities using futures and options
Standout Features:
- A growing base of seasoned instructors with practical experience in the fields they teach
- Great practical examples to aid learning
Benefits:
- Offers approved certification upon completion
- This course is a required step towards completing CFI’s Capital Markets and Security Analyst (CMSA) program
Downsides:
- It’s a fairly excellent training service but the platform undergoes a lot of rapid changes and evolution which may be a turn-off for some people.
Pricing:
$97
Duration:
It takes approximately 3 hours to complete this course.
Bulls on Wall Street: 60 Day Bootcamp (Best for Students Looking for Live-Action Trading)
Bulls on Wall Street is a trading chat room that offers day trading and swing trading education and alerts services. The platform is designed to offer a free-flow learning experience rather than a rigid formal setting. The 60-day bootcamp is great for students who want to get right into the action as they learn.
Learning Outcomes:
- Comprehensive introductory course
- Live trading experience
- Risk management
- Develop your trading strategy
Standout Features:
- Live learning from instructors with over 40 years of experience
- The bootcamp is set up to allow you to both participate in the live classes, but also refine your trading skills by using on-demand learning modules
Benefits:
- Access to great trading software
- Almost 10 years in business with over 40 years of experience in the market making this a highly accredited choice
Downsides:
- It is quite expensive
- There isn’t a free trial offer
Pricing:
$3000 for the overall course but you can start the intro course at $197
Duration:
60 day bootcamp
The ICE: ICE Education (Best for Students Looking to Get Into the Energy Commodity Market)
Intercontinental Exchange (ICE) was created in 2000. Its education arm provides both scheduled public courses, and on-demand video-based e-learning delivered by industry experts in their respective fields. Their courses provide great insight into energy markets and agricultural commodities.
Learning Outcomes:
- Futures trading
- Different trading perspectives
- Fundamental vs technical analysis
Standout Features:
- In-depth coverage of commodity trading by the leading traders and investors in the market.
Benefits:
- Multiple courses in different commodity markets are available
- Seasoned instructors and resources make this a great course
Downsides:
- Not much room for flexibility in personal schedules
- It is also a bit expensive compared to other courses
Pricing:
$995
Duration:
Varies depending on the course
What Is Commodity Trading?
Simply put, commodity trading is the buying and selling of commodities. To better understand this, you must first of all get an understanding of what the term commodity means.
A commodity is a product people use daily and can be used to produce other products and goods. Great examples of a commodity could include gold, crude oil, rice, or cocoa.
The emphasis here is always on a product that can produce other derivatives. With this in mind, we could very well say commodity trading is the buying and selling as well as trading of commodities and their derivatives.
There are typically four categories of commodities.
- Metals
- Agriculture
- Livestock
- Energy
As a commodity trader, you are investing in the raw material industry. And because these materials have a demand and supply chain, there is always room to make a profit.
What to Study to Become a Commodity Trader
Commodity trading is a lucrative career path. But few people know how to get into this career path or understand what they need to do and study to succeed as commodity traders.
Typically, if you want to pursue a career or business path here, there are certain courses you should focus on. The best way to learn commodity trading is to study business, accounting, and commerce.
Finance and economics are also equally important. These areas will provide you with the necessary foundation needed to thrive in the commodity trading business.
If you are interested in trading commodities and want to master the skill, consider taking one of these five classes mentioned below, as well.
What Are the Top 5 Traded World Commodities?
The four main categories of commodities provide a broad and ever-expanding list of commodities and derivatives that can be traded. Each category presents a lucrative field you can invest in as a trader.
But some commodities cover a larger portion of the commodity market in terms of capitalization. These commodities offer the highest form of profit because of the high demand for them.
Here are the top five traded world commodities today:
Brent Crude Oil:
If you are new to commodity trading, there are two crude oil commodities that set the market standard for oil globally. Brent oil is the first of the two and one of the most traded energy products and commodity globally.
Brent oil is that that has a low sulfur density and is extracted from the North Sea.
West Texas Intermediate Crude Oil:
The second energy commodity topping the chart is WTI crude oil. WTI and Brent crude oil set the benchmarks for oil, globally.
This commodity is traded for its low density and low sulfur content. The oil is also known as the Texas light sweet because of the low density.
The main difference between WTI and Brent crude oil is that WTI comes from the US whereas Brent is extracted in the North Sea.
Steel
Steel is a strong and very durable metal. It is a lucrative industrial metal in high demand globally.
In terms of production, over 1,803 billion tonnes were produced in 2018 alone. China is the world’s largest producer and exporter of this ferrous metal.
Steel is readily in high demand by car manufacturers, construction industries, railway infrastructure companies, and even the energy sector.
Copper
Copper is in high demand everywhere on the planet. It is a soft and malleable metal that is a great and efficient conductor of energy as well.
Copper also possesses similar physical properties to gold and silver which makes it a perfect fit for many industrial processes. South America has the largest copper mining statistics globally and China is the top producer of refined copper.
Iron Ore
Iron ore is a rock from which iron is extracted. The catch here is that most of the world’s iron is used to produced steel.
The mineral is in high demand globally, and as long as steel output continues to rise, the demand for iron ore will also remain high as well.
What Makes a Good Commodities Trading Course?
With so much to learn and know about commodity trading, having access to the right course is important. In choosing what course to take, there are a few important factors you should pay attention to. They include:
Access to Investor Resources
The best commodity trading courses will provide great resources for investors. Trading requires you to have access to a lot of data and investor resources, so a good course will show you how to navigate all of the information.
The information must be current and accurate as the statistics of the commodity market never remains neutral; it is constantly evolving. Look into the resources and information the course provides carefully before making a decision.
Expert Instructor With Experience
The best commodity trading courses will provide you with expert instructors and experienced traders who know the layouts of the commodity market practically. Do not waste time on platforms that offer information from instructors with low-level experience in the market.
Who you learn from will determine how fast you progress and your overall success. Look into the pedigree of the instructors and also look at reviews from past students.
Works With Your Lifestyle
We all have different lifestyles and schedules in today’s ever-busy world. But, it doesn’t mean there aren’t platforms that offer a great way for you to learn and grow while maintaining your lifestyle structure.
Many platforms offer different training structures, like synchronous and asynchronous classes. There are also online classes as well as classes that’ll meet in person.
Pick the programs that give you the best value with the most flexibility for your schedule.
Preparing for Commodity Trading
The opportunities that commodity trading offers are vast and ever-expanding. However, trading commodities can be complex and requires lots of background knowledge.
Beyond getting the best available courses, getting a financial advisor can give you a better strategic advantage to capitalize on the market and build wealth.
Frequently Asked Questions
Yes, commodity traders make a lot of money with an average income of over $200,000.
You can get into commodity trading by directly investing in commodities. Or you can invest in futures, commodity stocks, and mutual funds.
All commodity trading offers great profit opportunities. The top three however are precious metals, energy, and agriculture.
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