Commodities are essentially raw materials and foodstuffs like iron, copper, gold, crude oil, wheat, sugar, cotton and coffee beans among many others. These commodities are generally traded on dedicated exchanges around the world.
Though this asset class has faced considerable challenges in recent years, the long term fundamentals overwhelmingly support the case for including commodities in any properly diversified investment portfolio.
For both institutional and private investors, Monex Financial provides exposure to a variety of commodities by acquiring stock in ETFs or exchange-traded funds. An ETF is a pooled-investment fund that owns the underlying asset (gold bullion, crude oil futures, palm oil futures). This fund divides ownership of those underlying investments into shares. These shares are traded much like any other on a public stock exchange.
Holding shares in an ETF entitles the investor to a portion of the profits. ETFs are convenient because most investors do not want to take delivery of the underlying asset.
Some clients prefer to take physical delivery of certain commodities like precious metals. In these instances, Monex Financial can arrange for secure holding facilities in the event clients prefer not to make such arrangements themselves.