Can a quantitative system be made for commodity markets






A commodity market is a market that trades in the primary economic sector rather than manufactured products. Soft commodities are agricultural products like wheat, coffee, cocoa, fruit and sugar. Hard commodities are mined, like gold and oil.

Traders rely on small price movements for profits, there are two important factors to consider when deciding which instruments to trade: liquidity and volatility.

Markets with good liquidity typically trade with tight bid/ask spreads and with enough market depth to quickly fill orders.

Day trading involves buying and selling (or first short selling and then buying back) an instrument with an aim at making a quick profit.

High Liquidity: Ease of buying and selling in large amounts smoothens trading and ensures price fairness and efficiency.

High Volatility: High volatility is a friend if one wants to trade frequently with an aim to generate profits multiple times.

Get the best technical and fundamental analysis in stock trading and commodity from experts like Bazaar Trading, 100MCX.

(Source: https://www.quora.com/Can-a-quantitative-system-be-made-for-commodity-markets)


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