Trading metal commodities is an exciting and diverse area which includes precious metals like gold, silver, and palladium, as well as industrial metals like copper and lead. The market is influenced by various industries and can be very dynamic, which amplifies the potential for both profit and loss.
Precious metals, including silver, gold, platinum, and a few lesser-known ones, are popular for jewellery making, but this is not their only application. They possess unique qualities which make them highly valuable in an industrial context. Whether a metal is considered “precious” also depends on the available quantity of it, and there have been cases where a metal once included in the group of “precious” metals eventually dropped in price due to the discovery of abundant supply.
As prices can be influenced by the political relationships between suppliers and buyers of metals, it is important to monitor the latest events and watch for the way they affect the market. Political news is a great source of information to help traders navigate the emerging trends in metal trading.
Metals are a great addition to a portfolio as a way to diversify your investment, as this market is quite independent from others. Precious metals can also be used as a hedge in times of high inflation because they tend to preserve or restore their value over time. Unlike many other commodities, it is possible to actually possess your investment by e.g. buying gold bullion. There are plenty of types of metals to choose to invest in, knowing that global demand is constant, so your investment is likely to maintain its value. It is nonetheless important to expect and plan for high volatility and sudden changes in this diverse market. TRDPremium offers tools and services to help you make a profitable investment and trade well in the sector of metals.
Gold is an extremely popular commodity despite the high volatility on the market, as it offers high growth potential. Traditionally, gold has been considered a “safe haven” for investments as it tends to preserve its value over time, but nowadays this may not be entirely true. In times of significant inflation growth, this commodity is still a good hedge against losses.
One of the influences affecting gold prices is the balance of supply and demand, which works just like with any other commodity. But gold is a peculiar with its own specifics. For example, one of the factors affecting gold prices is uncertainty, because people will still turn to gold as a safe investment in times when other markets are difficult to predict. This way, high inflation causes gold prices to rise too. Economic data will also influence gold prices, as they tend to drop in a strong economy characterized by positive employment trends, growing wages and manufacturing volumes, as well as GDP. When the economy suffers a downturn, gold prices tend to go up. Gold is also connected to currency rates and its price tends to grow when the value of the U.S. dollar drops. As these moves are associated with psychological processes, they can be difficult to anticipate, but create great opportunities for traders.
TRDPremium offers easy access to this shiny market, as well as information resources to help you trade best.