Is It A Good Time To Invest In Commodities?

commodity investment
commodity investment

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“When it comes to investments, it all boils down to one simple question. Where do you lie in terms of investor types?

Most categories have been summed up into two main ones: the investor who dwells on continuation of trends, and the investor who partakes in a reversal of trends.

It`s no secret now that with the current state of affairs, the investor interested in the continuation of trends is more likely to succeed. This is because there has been a remarkable rise in stock markets making stocks high-return type of assets. On the other hand, however, if a person is in search of bargains, this venture has quite the slimmest of pickings. As dismal as that may seem, there is a ray of hope in the investment of commodities which could still be referred to as hard assets.
Hard assets have a vast array of options other than the commonly thought of gold and perhaps real estate. They are comprised of all sorts of resources that occur naturally with the likes of copper, oil, and coffee among many others. A common and trending mistake that most investors make is looking down upon the gravity natural resources hold. Looking at how it`s been devalued, it would be prudent for any serious bargainer to include natural resources at the top ranks of his or her wish list.

There are two main reasons why commodities should be the main feature in an investors map to getting good fortune.

a) Commodities have a tendency to dissociate themselves from syncing up with the current stock market trends. This helps in the diversification of a person`s investment and cuts down on risks that could be incurred. From the year 2000, approximately 35% of relation has been found linking stock markets to commodities.

b) If an investor`s choices are good enough, and he or she manages to purchase commodities at the most opportune time, the chances of making mind-blowing profits are very high.
A good practical example of this is Hilary Clinton. When you look back to the 1970 years, Hilary managed to open up a trading account for commodities. She did this with a company named Refco and deposited a total of 1,000 US dollars. She dealt with mostly buying and sales of quite an array of commodities. The commodity she dealt with most being cattle. In about ten months, the initial investment had amounted to 100,000 US dollars. On analysis, the profit she had gained was around 9,000% in returns.

Going by the numbers that resulted from the trading in just ten months, Hilary could have had tremendous profits if she had maintained that same momentum. It would have amounted to around 700 million US dollars in roughly three years and later on spilled over to quite a number of trillions in just ten or so years.

With all these points jotted down, it’s safe to affirm that investments in commodities is a very lucrative venture and is highly unlikely to let one down. Given the dip in prices that most natural resources currently have, it’s wise to invest in them and seriously take into consideration including them into your portfolio.”

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