What are commodities? In terms of Investments, commodities are those items which have no brand value. Commodities command price based on the demand and supply. Generally demand for commodities is inelastic, meaning commodities demand will not change much based on the price. They are usually basic necessities, example food grains. That does not mean price will not go up for supply disruptions. In fact they go up substantially during natural calamities because the demand for consumption will not go down from normal levels. Another characteristic of a commodity is they are traded in bulk and at low margin. The reason being, these commodities have no premium for brand and require no intellectual skills. Inflation is directly reflected in the prices of commodities. In the past 20 years are so commodities prices have gone down only because of unprecedented appreciation of US dollar. However due to flattening of World Economy, commodities prices are reflecting real inflation in US Dollar also. One way to hedge against inflation is to invest in commodities. Thanks to Technology and regulations, now it is as easy as 123 for individual investors to invest and trade in commodities. Every one can invest in commodities and benefit from the changes in prices just like the way they trade stocks, mutual funds. Added advantage of commodities trading is you can take more leverage and if you are a good trader with discipline can take the huge leverage like that of buying a home. Yes you can trade 10 times of your own money. If you have 10K you can buy commodities for 100K. Yes you can buy for 100K without going through the formalities of applying for loan, overdraft etc. This is very easy. AT the same time this is extremely risky. The reason for comparison with home buying is to compare the possibility of returns as many experienced with housing. Many have made or seen their neighbors made 100s of thousand in flipping homes. That much money can be made because of the leverage. With 0% - 10% down, any one can make huge money. With Housing there is no capital gain tax (if one home) but it is very easy with stocks/commodities to get out. You can get out as soon as you want. To learn more about the beauty and excitement involved in commodities trading please read next pages by clicking on How to Trade or Market Comments Plese suggest me to make it simple by clicking here UnitedWeStand