We found 11 online brokers that are appropriate for Trading Commodities.
Delving into the world of commodities trading, you'd want to partner with a broker that not only aligns with your trading style but also ensures a robust trading environment. With my two decades in the financial markets, I've seen brokers come and go, but IC Markets, eToro, RoboForex, XTB, and XM have consistently stood out for various reasons. Here's an insider's take on what makes each of these platforms unique, along with some of their drawbacks.
In the volatile commodity financial markets, IC Markets stands as a beacon for the seasoned trader, particularly for those of us accustomed to navigating the turbulent waves of market volatility. The platform's razor-edge spreads and the swiftness of trade execution make it a stronghold for the quick-reflexed scalper and the dynamic day trader alike. Its broad spectrum of tradable assets, underpinned by the solid regulatory frameworks of ASIC and CySEC, lays down a foundation of trust and reliability. Yet, it's worth noting that the sophistication of its offerings might daunt the greenhorn, and its penchant for the high-octane trading environment might not sit well with the strategist looking for long haul investments.
eToro breathes a new life into the trading scene with its pioneering social trading platform, offering a fertile ground for harnessing the collective wisdom of a sprawling network of traders. The CopyTrading feature is a gem, especially for those still cutting their teeth in the trading world, allowing them to shadow the maneuvers of the veterans. However, the very social fabric that makes eToro unique can sometimes cloud the waters of individual, analytical thought. Moreover, its fee structure, particularly concerning withdrawals and dormancy, might pinch for some.
For the commodity trader seeking a seamless trading experience across various devices, RoboForex emerges as a prime choice. Its embrace of a wide array of commodity instruments, coupled with the facility to leverage, makes it a strong contender. The platform's intuitive design and swift execution speeds are particularly conducive to responding promptly to the ever-volatile commodity markets.
XTB distinguishes itself with a staunch dedication to trader education and skill enhancement. The depth of its market analysis and educational offerings is indeed praiseworthy, appealing to the trader who places a premium on intellectual growth within the trading domain. Backed by robust regulatory standards, XTB is a haven for the discerning trader, though it might not resonate as much with those favoring a more laid-back or intuitive trading approach. While its product range is substantial, it may not quite match up to the global breadth some traders seek.
XM stands out for its unwavering commitment to the trader, tailoring the trading experience with a variety of account types and a comprehensive suite of trading instruments. The broker's dedication to customer service is second to none, positioning it as the go-to choice for traders who value efficient and effective support. Despite its strong regulatory stance, the platform's penchant for bonuses and promotions could detract from its appeal to the more serious trader. Furthermore, while its research tools are adequate, they might not fulfill the needs of the highly analytical trader.
In the grand chessboard of commodities trading, each of these brokers offers distinct advantages and considerations. The seasoned trader's choice should be informed by their trading style, experience, and what they value most—be it community engagement, educational depth, execution speed, or customer service excellence.
Commodity brokers, also called commodities brokers, are firms or individuals who help investors deal in commodity contracts by offering trading platforms, visiting international suppliers, determining delivery details, and whatnot.
Commodity brokers are focused on provide services related to commodity trading. The commodities traded on exchanges consist of wheat, rice, crude oil, natural gas, electricity, soybeans, silver, and gold.
Investors invest in commodities for different reasons. For instance, they provide returns that are different compared to other bonds and stocks. Moreover, inflation can destroy the value of bonds and stocks. It can also lead to loftier commodity prices.
On the other hand, dingular commodity prices can go up and down based on international market performance, based on factors like supply and demand, inflation, exchange rates, and the health of the economy, overall.
In the realm of commodities trading, as you're well aware, brokers are tightly regulated by the pertinent authorities in their jurisdictions. Take the UK, for instance, where the Financial Conduct Authority keeps a close watch on the operations. Down in South Africa, it's the Financial Sector Conduct Authority (or the FSCA) of South Africa monitoring commodities brokers, while over in Germany, BaFin sets the rules of the game.
These commodities brokers aren't pigeonholed into dealing on just one exchange; they've got the latitude to operate across various platforms, including the likes of the New York Mercantile Exchange and Chicago Board of Trade. You'll recall how, towards the latter part of the last decade, the investment banks were major players in the commodities space, a testament to the dynamic nature of our field.
There are numerous ways to find the best commodity brokers, but we discuss the proven ones based on past market reports.
The following are some of the best commodities brokers to look into before choosing one to help with your trades in the Futures markets and financial derivatives markets.
Such online brokers or brokerage firms normally trade on the exchange floor on behalf of customers or traders. They are paid in commissions for their services.
In short, such commodity brokers are referred to as FCM. The broker or the brokerage firm holds their private and commercial clients’ funds to a margin similar to how broker-dealers do.
The introducing broker or the firm never directly holds the client's funds. Instead, they do so through an FCM since traders sometimes prefer not to work with FCMs.
This is where an individual commodities broker or a firm just offers investment advice to traders on commodity trading and works as a power of attorney on their clienteles’ behalf.
A commodity that is equal to a mutual fund is called a commodity pool. The CPO operates under the CTA.
An RCR (or Registered Commodity Representative) or AP (or Associated Person) can be a partner, officer, a CPO employee IB, CTA, or FCM. They are qualified to work with their corporations.
Traders can directly trade commodities via futures contracts, ETFs, CFDs, mutual funds, or the equities market.
Under normal circumstances, commodity traders choose to trade via CFD trading. That is mostly due to the leverage it offers, as well as its smaller contracts. The initial revenue is exceptionally low in comparison to other commodity trading forms, however.
In this type of trading, traders do not need the commodity in physical form. Previously, only grain and livestock were traded, but now an increasing number of commodities have made it into the market, i.e., precious metals, energy, natural gas, bonds, etc.
You can trade commodities in your portfolio in many ways, and each type has its advantages and disadvantages:
The most widespread way of trading commodities is buying and selling contracts on an exchange. In this, an investor agrees with another based on the commodity’s future price.
For instance, an investor may agree to a commodity future contract to invest in ten thousand oil barrels at 45 USD a barrel in thirty days.
When the contract ends, the investor does not transfer the physical goods, instead, they close out their contract by assuming an opposite position via the spot trading market.
Therefore, in this example, once the futures contract ends, the investor would close out the position, agreeing to another contract to sell ten thousand oil barrels at the current market price.
If the spot price turns out to be higher than the investor’s contract price of 45 USD per barrel, they would profit from it, if it is lower, they would lose capital. In contrast, if an investor had agreed to a futures contract to sell oil, they would earn revenue upon the spot price going down, and they would lose capital upon the spot price going up.
At any moment, the investor could close out their position before the contract’s termination date. To be able to invest in futures trading, investors must create a commodity account with a commodity broker UK offering these kinds of trades.
When an investor trades futures contracts, they are not buying or selling the commodity in physical form. Those who trade futures with oil trading commodity brokers do not have millions of oil barrels or cattle herds delivered to them since futures only involve betting on price movements.
For precious metals like silver and gold, however, investors do take possession of the physical commodities. These include gold coins, bars, or jewellery.
Such investments offer them exposure to commodities silver, gold, as well as other precious metals, and let them feel the weight of their investments. Transaction costs are higher with precious metals, however.
Another way you can go about this is to buy the stock of a corporation involved with a commodity. For oil, traders could invest in the stock of drilling or oil refining companies. For grain, they could buy into an agriculture business or one selling seeds.
These particular stock investments track the prices and values of the underlying commodity. If the prices of oil go up, an oil corporation should be lucrative so its share value would go up as well.
Buying commodity stocks come with lower risk compared to investing directly in commodities since the investor is not merely betting on the price of the commodity. A well-established corporation could still earn revenue despite the commodity value falling. This works in all cases, however. Although increased oil prices could help promote an oil firm’s stock price, there are other factors, too, such as their firm management and net market share. In case you are on the hunt for a certain asset that accurately tracks the price of a commodity, buying stocks is not the best match.
Besides physical commodities and whatnot, there are mutual funds, ETFs, and ETNs (or exchange-traded notes) that are contingent on commodities as well. Such funds merge all the funds from numerous private investors to build a large portfolio that can track the value of a commodity or a commodity basket, e.g., an energy mutual fund contingent on several energy commodities. The fund may either buy futures contracts for price tracking or buy the stock of different corporations with exposure to commodities.
By making a small investment, investors can access a larger range of commodities than if they tried to build the portfolio themselves. Besides that, they will also be accompanied by an expert investor overseeing the portfolio. Investors will still have to pay an extra management fee to the commodity fund in contrast to what it may cost them if they had made the investments on their own. Moreover, based on the fund’s methodology, it might not track the commodity price accurately.
Put simply, commodity pools and managed futures are privately held funds known to invest in commodities. They are identical to mutual funds, their only difference being that they are not traded publicly, in which case, investors will need the approval to be able to invest in them.
Such funds can facilitate more complicated strategies compared to mutual funds and ETFs; therefore, they hold the potential for more substantial returns. In return, the management fees may also be higher.
Investing in commodities can offer several benefits to investors, including diversification, inflation hedging, and potential returns. Here are some key benefits of investing in commodities:
Diversification:
Inflation Hedge:
Portfolio Protection:
Global Economic Exposure:
Tangible Assets:
Potential for Returns:
Risks and Returns Diversification:
Supply and Demand Dynamics:
Alternative Investment:
Speculative Opportunities:
Sector Specific Exposure:
Potential for Income:
While commodities can offer diversification and potential benefits, it's crucial for investors to carefully consider the risks associated with commodity investing, including market volatility, geopolitical factors, and the unique characteristics of specific commodities.
Investing in commodities can offer diversification benefits, but it also comes with its own set of disadvantages. Here are some potential drawbacks associated with investing in commodities:
Volatility:
Lack of Income Generation:
Storage Costs:
No Inherent Growth:
Market Complexity:
Liquidity Concerns:
Currency Risk:
Geopolitical Risks:
Environmental Risks:
Regulatory Changes:
Specific Market Knowledge Required:
Commodity trading is a specific strategy that works best for seasoned commodity investors. Before trading commodities, it is crucial to understand how it all works, i.e., how the trading platform works, commodity price charts, and other methods of research.
Since market price movements can result in substantial losses or gains, individual traders must develop a high-risk tolerance to cope with sudden changes. Aside from that, if you do consider investing in commodities with a commodity broker, according to essential advice offered by seasoned traders, it should take up only a portion of your entire portfolio.
We have conducted extensive research and analysis on over multiple data points on Commodities Brokers for Commodity Trading to present you with a comprehensive guide that can help you find the most suitable Commodities Brokers for Commodity Trading. Below we shortlist what we think are the best commodities brokers after careful consideration and evaluation. We hope this list will assist you in making an informed decision when researching Commodities Brokers for Commodity Trading.
Selecting a reliable and reputable online Commodities trading brokerage involves assessing their track record, regulatory status, customer support, processing times, international presence, and language capabilities. Considering these factors, you can make an informed decision and trade Commodities more confidently.
Selecting the right online Commodities trading brokerage requires careful consideration of several critical factors. Here are some essential points to keep in mind:
Our team have listed brokers that match your criteria for you below. All brokerage data has been summarised into a comparison table. Scroll down.
When choosing a broker for commodities trading, it's essential to compare the different options available to you. Our commodities brokerage comparison table below allows you to compare several important features side by side, making it easier to make an informed choice.
By comparing these essential features, you can choose a commodities broker that best suits your needs and preferences for commodities. Our commodities broker comparison table simplifies the process, allowing you to make a more informed decision.
Here are the top Commodities Brokers.
Compare commodities brokers for min deposits, funding, used by, benefits, account types, platforms, and support levels. When searching for a commodities broker, it's crucial to compare several factors to choose the right one for your commodities needs. Our comparison tool allows you to compare the essential features side by side.
All brokers below are commodities brokers. Learn more about what they offer below.
You can scroll left and right on the comparison table below to see more commodities brokers that accept commodities clients.
Broker | IC Markets | Roboforex | eToro | XTB | XM | Pepperstone | AvaTrade | FP Markets | EasyMarkets | SpreadEx | FXPro |
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Regulation | Seychelles Financial Services Authority (FSA) (SD018) | RoboForex Ltd is regulated by the FSC, license 000138/437, reg. number 128.572. RoboForex Ltd, which is an (A category) member of The Financial Commission, also is a participant of its Compensation Fund | FCA (Financial Conduct Authority) eToro (UK) Ltd (FCA reference 583263), eToro (Europe) Ltd CySEC (Cyprus Securities Exchange Commission), ASIC (Australian Securities and Investments Commission) eToro AUS Capital Limited ASIC license 491139, CySec (Cyprus Securities and Exchange Commission under the license 109/10), FSAS (Financial Services Authority Seychelles) eToro (Seychelles) Ltd license SD076 | FCA (Financial Conduct Authority reference 522157), CySEC (Cyprus Securities and Exchange Commission reference 169/12), FSCA (Financial Sector Conduct Authority), XTB AFRICA (PTY) LTD licensed to operate in South Africa, KPWiG (Polish Securities and Exchange Commission), DFSA (Dubai Financial Services Authority), DIFC (Dubai International Financial Center), CNMV (Comisión Nacional del Mercado de Valores), KNF (Komisja Nadzoru Finansowego), IFSC (Belize International Financial Services Commission license number IFSC/60/413/TS/19) | Financial Services Commission (FSC) (000261/4) XM ZA (Pty) Ltd, Cyprus Securities and Exchange Commission (CySEC) (license 120/10) Trading Point of Financial Instruments Ltd, Australian Securities and Investments Commission (ASIC) (number 443670) Trading Point of Financial Instruments Pty Ltd | Financial Conduct Authority (FCA), Australian Securities and Investments Commission (ASIC), Cyprus Securities and Exchange Commission (CySEC), Federal Financial Supervisory Authority (BaFin), Dubai Financial Services Authority (DFSA), Capital Markets Authority of Kenya (CMA), Pepperstone Markets Limited is incorporated in The Bahamas (number 177174 B), Licensed by the Securities Commission of the Bahamas (SCB) number SIA-F217 | Australian Securities and Investments Commission (ASIC) Ava Capital Markets Australia Pty Ltd (406684), South African Financial Sector Conduct Authority (FSCA) Ava Capital Markets Pty Ltd (45984), Financial Services Agency (Japan FSA) Ava Trade Japan K.K. (1662), Financial Futures Association of Japan (FFAJ),, FFAJ, Abu Dhabi Global Markets (ADGM)(190018) Ava Trade Middle East Ltd (190018), Polish Financial Supervision Authority (KNF) AVA Trade EU Ltd, Central Bank of Ireland (C53877) AVA Trade EU Ltd, British Virgin Islands Financial Services Commission (BVI) BVI (SIBA/L/13/1049), Israel Securities Association (ISA) (514666577) ATrade Ltd, Financial Regulatory Services Authority (FRSA) | CySEC (Cyprus Securities and Exchange Commission) (371/18), ASIC AFS (Australian Securities and Investments Commission) (286354), FSP (Financial Sector Conduct Authority in South Africa) (50926), Financial Services Authority Seychelles (FSA) (130) | Cyprus Securities and Exchange Commission (CySEC) (079/07) Easy Forex Trading Ltd, Australian Securities and Investments Commission (ASIC) (Easy Markets Pty Ltd 246566), British Virgin Islands Financial Services Commission (BVI) EF Worldwide Ltd (SIBA/L/20/1135), Financial Sector Conduct Authority South Africa (FSA) EF Worldwide (PTY) Ltd (54018), FSC (Financial Services Commission) (SIBA/L/20/1135), FSCA (Financial Sector Conduct Authority) (54018) | FCA (Financial Conduct Authority) (190941), Gambling Commission (Great Britain) (8835) | FCA (Financial Conduct Authority) (509956), CySEC (Cyprus Securities and Exchange Commission) (078/07), FSCA (Financial Sector Conduct Authority) (45052), SCB (Securities Commission of The Bahamas) (SIA-F184), FSA (Financial Services Authority of Seychelles) (SD120) |
Min Deposit | 200 | 10 | 50 | No minimum deposit | 5 | No minimum deposit | 100 | 100 | 25 | No minimum deposit | 100 |
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Used By | 200,000+ | 730,000+ | 35,000,000+ | 1,000,000+ | 10,000,000+ | 400,000+ | 400,000+ | 200,000+ | 250,000+ | 60,000+ | 7,800,000+ |
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Platforms | MT5, MT4, MetaTrader WebTrader, Mobile Apps, iOS (App Store), Android (Google Play), MetaTrader iPhone/iPad, MetaTrader Android Google Play, MetaTrader Mac, cTrader, cTrader Web, cTrader iPhone/iPad, cTrader iMac, cTrader Android Google Play, cTrader Automate, cTrader Copy Trading, TradingView, Virtual Private Server, Trading Servers, MT4 Advanced Trading Tools, IC Insights, Trading Central | MT4, MT5, R Mobile Trader, R StocksTrader, WebTrader, Mobile Apps, iOS (App Store), Android (Google Play), Windows | eToro Trading App, Mobile Apps, iOS (App Store), Android (Google Play), CopyTrading, Web | MT4, Mirror Trader, Web Trader, Tablet, Mobile Apps, iOS (App Store), Android (Google Play) | MT5, MT5 WebTrader, XM Apple App for iPhone, XM App for Android Google Play, Tablet: MT5 for iPad, MT5 for Android Google Play, XM App for iPad, XM App for iOS (App Store), Android (Google Play), Mobile Apps | MT4, MT5, cTrader,WebTrader, TradingView, Windows, Mobile Apps, iOS (App Store), Android (Google Play) | MT4, MT5, Web Trading, AvaTrade App, AvaOptions, Mac Trading, AvaSocial, Mobile Apps, iOS (App Store), Android (Google Play) | MT4, MT5, TradingView, cTrader, WebTrader, Mobile Trader, Mobile Apps, iOS (App Store), Android (Google Play) | easyMarkets App, Mobile Apps, iOS (App Store), Android (Google Play), Web Platform, TradingView, MT4, MT5 | Web, Mobile Apps, iOS (App Store), Android (Google Play), iPad App, iPhone App, TradingView | MT4, MT5, cTrader, FxPro WebTrader, FxPro Mobile Apps, iOS (App Store), Android (Google Play) |
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Risk Warning | Losses can exceed deposits | Losses can exceed deposits | 51% of retail investor accounts lose money when trading CFDs with this provider. | 75-83% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. | CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.12% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. | 75-95 % of retail investor accounts lose money when trading CFDs | 71% of retail investor accounts lose money when trading CFDs with this provider | Losses can exceed deposits | Your capital is at risk | Losses can exceed deposits | 75.78% of retail investor accounts lose money when trading CFDs and Spread Betting with this provider |
Demo |
IC Markets Demo |
Roboforex Demo |
eToro Demo |
XTB Demo |
XM Demo |
Pepperstone Demo |
AvaTrade Demo |
FP Markets Demo |
easyMarkets Demo |
SpreadEx Demo |
FxPro Demo |
Excluded Countries | US, IR, CA, NZ, JP | AU, BE, BQ, BR, CA, CW, CZ, DE, ES, EE, EU, FM, FR, FI, GW, ID, IR, JP, LR, MP, NL, PF, PL, RU, SE, SJ, SS, SL, SI, TL, TR, DO, US, IT, AT, PT, BG, HR, CY, DK, FL, GR, IE, LV, LT, MT, RO, SK, CH | ZA, ID, IR, KP, BE, CA, JP, SY, TR, IL, BY, AL, MD, MK, RS, GN, CD, SD, SA, ZW, ET, GH, TZ, LY, UG, ZM, BW, RW, TN, SO, NA, TG, SL, LR, GM, DJ, CI, PK, BN, TW, WS, NP, SG, VI, TM, TJ, UZ, LK, TT, HT, MM, BT, MH, MV, MG, MK, KZ, GD, FJ, PT, BB, BM, BS, AG, AI, AW, AX, LB, SV, PY, HN, GT, PR, NI, VG, AN, CN, BZ, DZ, MY, KH, PH, VN, EG, MN, MO, UA, JO, KR, | US, IN, PK, BD, NG , ID, BE, AU | US, CA, IL, IR | AF, AS, AQ, AM, AZ, BY, BE, BZ, BT, BA, BI, CM, CA, CF, TD, CG, CI, ER, GF, PF, GP, GU, GN, GW, GY, HT, VA, IR, IQ, JP, KZ, LB, LR, LY, ML, MQ, YT, MZ, MM, NZ, NI, KP, PS, PR, RE, KN, LC, VC, WS, SO, GS, KR, SS, SD, SR, SY, TJ, TN, TM, TC, US, VU, VG, EH, ES, YE, ZW, ET | BE, BR, KP, NZ, TR, US, CA, SG | US, JP, NZ | US, IL, BC, MB, QC, ON, AF, BY, BI, KH, KY, TD, KM, CG, CU, CD, GQ, ER, FJ, GN, GW, HT, IR, IQ, LA, LY, MZ, MM, NI, KP, PW, PA, RU, SO, SS, SD, SY, TT, TM, VU, VE, YE | US, TR | US, CA, IR |
You can compare Commodities Brokers ratings, min deposits what the the broker offers, funding methods, platforms, spread types, customer support options, regulation and account types side by side.
We also have an indepth Top Commodities Brokers for 2024 article further below. You can see it now by clicking here
We have listed top Commodities brokers below.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 51% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
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