Is Oil the Best Commodity for Trading?


Quick Answer

There is no mathematical formula or financial indicator to determine if oil is the best commodity for trading, but it does have several applications as a valuable natural resource, notes the Forex website. It is a naturally occurring petroleum used in energy production and manufacturing, making it valuable for trading.

Continue Reading
Is Oil the Best Commodity for Trading?
Credit: Stephen Collector Photographer's Choice Getty Images

Full Answer

Oil is available to buy and sell on several stock market exchanges. More specifically, investors can search for an oil ETF, or exchange-traded fund, as noted by About Money. These funds consist of either oil company stocks or futures instead of the actual commodity itself. For example, the fund trading under the ticker USO is one of the most commonly traded oil securities. This fund contains stocks from some of the most popular companies in the oil, gas and petroleum industry.

Other oil exchange-traded funds include OIL, UNG, DBO, DBE and UGA, as listed by the ETF database. As of March 2015, the majority of these funds are comprised of over $1 million in assets. An investor can begin trading these funds by signing up for a discount brokerage and then searching for the specific ETF in the database. Some of the common discount brokerages include OptionsHouse, Ameritrade, Scottrade, Schwab and Fidelity, as noted by the official Nasdaq website.

Learn more about Industries
Related Videos

Related Questions