There are a lot of investment options available for you and there are a lot of ways you can get the best out of the investments. There are commodity investments and there are stock markets.
Talking about investments in commodities, there are so many options available for you. From gold to bitumen, from silver to copper commodity, there are so many commodities available for you to invest in. Then again there is stock market where you can invest your money and get return. According to a new survey, almost 80% of the people who are now investing in commodity, have had the taste of investing in equity options or stock market. They have always claimed that investing in the commodity market is much more beneficial than investing in the stock market.
Investing in the commodity market is a low margin investment. But the return is always higher than the stock market. Margins posted to hold short stock options can be 10 to 20 times the premium collected for the option. The investment may seem lower in the commodity market but the return is far better and much more than the equity investment.
A lot of people who have experience in investing in the stock market have complained that it doesn’t hold liquidity options. While some futures contracts have higher open interest than others, most of the major contracts, such as financials, sugar, grains, gold, natural gas and crude oil, have substantial volume and open interest, offering several thousand open contracts per strike price.
Stock market seems to be quite fluctuating and it is highly risky. It is indeed true that even the commodity market is risky but it isn’t too much fluctuating. The gold prices for example most of the times rises; then again the fuel and gas commodity prices rise too. Moreover, the price of the stock dependent on various factors but the price of the commodity market doesn’t depend on any of the factors.
Investing in commodity provides you diversification. Equity investment doesn’t provide you that. In commodities, the price of natural gas has little to do with the price of wheat or silver. This can be a major benefit in diluting risk.
There are a lot of benefits of investing in commodity market than investing in equity options or stock market. This is the reason why investing the commodity market is a better investment than the stock markets.
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