The commodity markets provide a central, regulated environment to transfer risk through hedging techniques, gain liquidity and discover price fairly. Since futures are obligations (rather than assets, like stocks), futures can be shorted at any time with no inventory or borrowing consideration. Contracts can be sold as an opening position at any time. Price and position limits create market equilibrium.
The liquidity of the commodity markets allows movement in and out of large positions quickly and efficiently. When you add commodities to your portfolio, you gain diversification and protection against volatility. Additionally, commodities have tax benefits not available to securities. Call today for more information!