Trading commodities on the Visual Trading Machine is as easy as it is to trade currencies. iBrokers offer a number of commodities that are traded differently to currencies.
At iBrokers, we trade energy commodities that include WTI Crude Oil, Gas Oil, Brent Crude and Heating Oil. Investors trade these commodities for a number of reasons which include hedging, investing and speculating. Energy companies and consumers usually trade energy commodities on a large scale to hedge themselves against rising or falling prices. Future contracts are used in trading commodities. A future contract can be defined as a contractual agreement to buy or sell a particular commodity at a pre-determined price in the future. At iBrokers, we allow you to trade commodities online using our Day Trading product. It is important to note that the deals are cash settled. This is to mean that you will not keep the actual goods. Another important note is that they must expire on a set day in the future. The next futures delivery month is what the pricing of all commodities day trading deals are based on.
How to Open a Day Trade and Trade Commodities Online with iBrokers
1. The first thing is to log into your account and go to the Trade Zone 2. In the central trading ticket, select the commodities tab 3. After making the selection, there will be a change on the Rates Table from currencies to commodities 4. Customization of commodities table is allowed as it is with currency rates table 5. Select the commodity you want to buy or sell 6. Select the amount to trade 7. The next is step is to determine the risk margin 8. After that, your Stop Loss is set automatically though you can change it afterward 9. Click on ‘Freeze Now’ to lock in a rate for a few seconds. Alternatively, you can open the deal by going to Trade Now 10. As you will notice, there will be no Renewal Date for commodities. This is because they are future contacts 11. Check in the trading ticket to get the expiry date of your contract 12. If you wish to close the deal before the expiry date, you can do so. The amount that you traded with will be returned in your account.
Note: In the USA and some other regions, commodities are not available for trading. Therefore you should check with your Personal Dealer to confirm whether commodities trading is available in your region.