There are several methods for capitalizing on global commodities through futures markets:
Self-Directed Online Trading #
Most retail futures traders engage in self-directed online trading. They make their own decisions, execute trades, and take responsibility for the outcomes. This approach involves using a computer-based futures trading platform to transmit orders via an internet connection. Traders can directly trade on a futures exchange or through a clearing firm that sends their orders to the exchange. To get started, open an account with a futures broker, choose a platform supported by the broker, and begin trading.
Broker Assisted Trading #
For a personalized and long-term relationship with a dedicated broker, consider broker-assisted trading. This program involves working with a licensed investment advisor who helps understand your trading objectives, research and monitor the markets, and place orders in your best interests. Your advisor considers fundamental global macro factors and technical analysis to make informed trading decisions. Each transaction is confirmed on your broker portal, and you receive statements via email. You can freely discuss your trading ideas with your broker and receive feedback and advice
Managed Futures #
If you prefer having a professional money manager make decisions about your commodity investments, consider managed futures. Commodity trading advisors (CTAs) are experienced money managers specializing in global futures markets. They diversify across markets, aiming for positive returns from price changes in stock indices, currencies, treasury futures, bond futures, and various commodities. CTAs can participate in over 150 global markets. You can select a CTA, open a trading account for them to manage, and monitor the trading activity of the Managed Futures Program.
Automated and Algorithmic Systems #
Automated trading systems are computer programs designed by expert developers to follow specific algorithmic strategies. These systems continuously analyze market data, look for trends, and generate buy and sell signals based on mathematical and technical formulas. The performance of these systems, whether hypothetical or live, is tracked in real-time. If you lack the time to monitor and implement your own trading plan, you can access a database of automated trading systems through services like Polar Stock and Mimic.Trade.