Wednesday, March 3, 2010

Investment Trends | Investing in Commodities

Investment Trends

Investing in commodities is going to be one of the more lucrative ways to build wealth in the years ahead, and there are numerous ways and sectors within the overall commodity sector to get it done.

For example, you have commodity futures, where the commodity in and of itself is invested in; for example gold, platinum, silver, copper, palladium, wheat, rice, corn, soybeans, cocoa, coffee, and many others.

You can also invest in commodities through a commodity ETF, commodity ETN, commodity index and commodity fund.

There are mining companies of a wide variety, with some specializing in specific commodities, and others holding a number of different mining interests.

Others like Potash and Caterpillar serve the commodity market through providing tools for those growing grains in this case, or it could be companies providing mining equipment, etc. You get the idea.

In a business world that is getting harder and harder to trust the numbers the companies put forth, or evaluate products that are supposed to wow everyone and drive the revenue and profits of a company, the one thing raw materials, metals and agricultural products assure us all is there will always be a market for them as long as there are people.

We of course have to watch the supply and demand factor, the income the population of a specific country averages, and a number of other factors.

But always comes down to supply and demand eventually, and if there is demand somehow the supply will come.

Like anything else though, look to sources you can trust as to the true nature of where things are at with commodity demand, as even there people can attempt to play you if you let them.

Don't be in a hurry. Do your research. Look at the general and specific economics of the commodity you want to invest in. Even if it's a commodity index, you can check to see if the basket of commodities they're promoting is in fact in a period of demand or not.

No matter what though, commodities should be a part of every investors portfolio in the years ahead, and you can be sure they'll be important to wealth building; as much as any other sector for a long time to come.

Investment Trends