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When you buy and sell commodities, is it just like trading stocks?
Posted by admin on April 17th, 2010
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Its different in the fact that you wouldn’t mind delivery of a share certificate, but maybe not so pleased if you got ton of sugar or whatever dumped on ypur front lawn. With commodities you either deal in ETFs (securitised commodities) or the futures market.
Stocks and shares are just a tiny ownership of a company, proof of which is in the form odf a certificate or electronic schedule. Commodities are actually the physical thing changing hands. For example Tate & Lyle will actually be selling sugar to be put in bags for supermarkets.You could buy some of that sugar say for delivery in August. You have to sell or close the contract before then.