commodity

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Commodity

A commodity is food, metal, or another fixed physical substance that investors buy or sell, usually via futures contracts.

commodity

A generic, largely unprocessed, good that can be processed and resold. Commodities traded in the financial markets for immediate or future delivery are grains, metals, and minerals. They are generally traded in very large quantities. See also futures contract.

Commodity.

Commodities are bulk goods and raw materials, such as grains, metals, livestock, oil, cotton, coffee, sugar, and cocoa, that are used to produce consumer products.

The term also describes financial products, such as currency or stock and bond indexes.

Commodities are bought and sold on the cash market, and they are traded on the futures exchanges in the form of futures contracts.

Commodity prices are driven by supply and demand. When a commodity is plentiful -- tomatoes in August, for example -- prices are comparatively low. When a commodity is scarce because of a bad crop or because it is out of season, the price will generally be higher.

You can buy options on many commodity futures contracts to participate in the market for less than it might cost you to buy the underlying futures contracts. You can also invest through commodity funds.

commodity

any economic GOOD but in commercial circles more specifically agricultural produce and minerals such as wheat, tea, copper, iron ore, etc. See COMMODITY MARKET, INTERNATIONAL COMMODITY AGREEMENT.

commodity

  1. 1see GOODS.
  2. raw materials rather than goods in general: for example, tea, coffee, iron ore, aluminium, etc.
References in periodicals archive ?
We have several partnerships with China to be announced in the coming weeks that will positively impact the flow of commodities trade through
DMCC, one of the world's leading commodity hubs for trade and enterprise, has signed a MoU with the Dubai Economic Council (DEC) to further enhance the emirate's global position as an inclusive, efficient, transparent and compliant marketplace for commodities trade.
It serves to provide a framework of support and strategic co-operation on commodities trade including ways to enhance efficiencies; corporate governance and regulation; support further publication of commodities statistics; and further implementation of responsible sourcing measures in line with international benchmarks.
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