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A commodity is a raw material or primary agricultural product that can be bought and sold, such as oil, natural gas, gold, silver, wheat, or coffee. In CFD trading, commodities are traded as derivative contracts — you speculate on price movements without taking physical delivery. Commodities are influenced by supply and demand dynamics, geopolitical events, weather, and macroeconomic conditions.
You trade WTI crude oil as a CFD. If OPEC announces a production cut, oil prices typically rise. You buy 1 lot of USOIL at $70.00 and close at $72.50; with a contract size of 100 barrels that is a $250 gain, without ever handling a barrel of oil. Check the actual contract size in the instrument’s specifications. Prices in this example are illustrative.
