Why trade precious metals CFD with CWG?
Long and short
Trading gold and silver online, in a risk-controlled environment, practice high-quality investment products other than foreign exchange on a simulated account.
Metals on margin
Gain full exposure to precious metals, such as gold, with only a small deposit.
Risk management tools
Make sure you have complete control over every trade with stops, alerts and more.
Precious and Industrial Metals
Metals are commodity assets which are mined from the earth. For hundreds of years, governments have been using metals as indicators of value and mediums of exchange, making an ideal trading instrument. Precious metals such as platinum, silver, gold, and industrial metals such as copper are listed for trading based on price movements for each metal. Moreover, these metals have everyday applications ranging from jewelry to electronics.Open A Live Account
Metal CFD Trading with CWG Trading
Metal trading is one of the most interesting commodities to break into. From silver and gold trading through palladium, metal is a material that’s in demand across many industries. It can be a very volatile marketplace to trade in. So, where to start? Here are CWG trading’s top tips to help you get started.
How do I start gold and silver CFD trading?
Silver and gold trading, or any other metal you prefer, is a fairly simple market to understand.
Silver trading, along with gold, platinum and a few others, is termed ‘precious metal trading’ in the commodity market. Remember- many of these metals aren’t only used in jewelry, however- there are many industrial applications for them. Starting from circuit boards onwards, that is why they trade so highly. You’ll find listings everywhere, but the New York Mercantile Exchange, the Tokyo Mercantile Exchange and the London Bullion Market is the top picks for variety.
There is one thing every commodity trader should know- this market can be very volatile. However, that means that immense profit or losses can be made as well. Volatility is primarily driven by the fact that many of the geo-political areas metals are harvested in, like the Middle East, can be politically unstable. Don’t let that deter you from these lucrative markets, however remember that responsible trading should include doing your homework before hand. Paying attention to international events is a great way to predict the market movement. Far Eastern markets will often be good indicators for the current trading prices, as they open relatively earlier than the rest of the world.
What advantages does metal trading hold?
There are a few distinct advantages to the Metal commodity market.
√ Metal makes a great diversifying tool, completely independent of other markets
√ Great inflation hedge
√ Physical possession is possible unlike other investments (e.g. Gold bullions)
√ There are many investment types to choose from
√ A Wide variety of metals
√ Essential, global currency- metal is always in use
As you can see, there are a few distinct possibilities with metal trading. When you trade with CWG Trading, you get the advantage of our unique platform tools
to help buoy you through the process, too, so it’s well worth considering investing in this critical resource.
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Factors affecting precious metal prices
Supply and demand
Like any product or service, a shortage of precious metals, or an increased need for them, makes them more valuable. For example, if a strike at a major silver mine interrupts production, silver prices may see an uplift over the short term. An improvement in mining equipment, meanwhile, could have the opposite effect, speeding up production and saturating the market.
Strength of the dollar
Given that the precious metals are dollar-denominated, they are particularly susceptible to the value of the greenback. When the dollar falls, precious metals are both a good place to store its value and less costly for other countries to purchase – meaning it is likely to push the price of precious metals higher.
In times of economic and political instability, precious metals are traditionally viewed as safe havens due to their lasting value. We saw this theory in action when Donald Trump’s election caused gold to rally, as nervous investors flocked towards its market security.
Precious metals offer a desirable alternative for fixed- income investors, whose investments offer a lower yield when rates are slashed. As such, Fed decision-making may guide investors towards these safe-haven opportunities, but the Fed’s impact on precious metals shouldn’t be overstated. Of more importance is how rate announcements affect the dollar.
Precious metals have a huge range of industrial uses, including in the manufacture of automotive parts, medical devices, precision electronics and jewellery. What’s more, new applications are continuously being developed. As demand for these goods grows, so does the demand for precious metals.
Precious metals generally perform better in a rising- inflation environment. This is because quantitative easing, or money-printing, dilutes the value of the currency in circulation, and makes it more expensive to buy assets which are viewed as a reliable store of value.