While leverage can magnify your profits, it can also magnify your losses, so trading with CFDs requires a full risk management strategy. The profit on your CFD position would depend on whether your prediction of copper price movements was correct and the extent to which the market price moved in your favour. If the market moved against you, your CFD position would result in a loss.

Trade commodity futures, as well as 27 commodity markets with no fixed expiries. There are a variety of trading strategies that you can employ depending on your personal preferences and knowledge of technical indicators. But broadly speaking, copper trading strategies will depend on whether the market is trending or consolidating. Copper trading does carry risk, especially if you decide to trade using leverage, which makes it important for you to create a strategy that will help manage risk and protect your trades. Futures trading involves the substantial risk of loss and is not suitable for all investors.

Where Can You Trade Copper?

The Charles Schwab Corporation provides a full range of brokerage, banking and financial advisory services through its operating subsidiaries. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (Member SIPC), offers investment services and products, including Schwab brokerage accounts. Its banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides deposit and lending services and products. Access to Electronic Services may be limited or unavailable during periods of peak demand, market volatility, systems upgrade, maintenance, or for other reasons. For example, as a large producing nation, Bolivia had significant sway over copper prices.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72% 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. CFD and Forex Trading are leveraged products and your capital is at risk.

How can I keep track of copper prices?

Fast-growing economies of China and India have an increasing  demand for transportation and housing infrastructure, which inevitably raises the demand for copper. Within those two primary methods, there are multiple ways to invest in the metal, including physical copper, futures, stocks, ETFs, and mutual funds. If prices decline, the trader is required to provide additional funds (margin) to maintain the position. https://forexarticles.net/options-as-a-strategic-investment/ Copper CFDs allow traders to speculate on the price of copper without actually owning bullions, ETFs, futures, options, or mining shares. Disruptions in supply can lead to dramatic swings in the price of copper on a short-term basis. For example, miner strikes in major copper-producing companies like Chile and Peru could cause a short-term drop in the supply of copper, which pushes up the price.

• Known as the manufacturing hub of the world, China consume almost half of the world’s copper but do not have enough reserves.
• Of the two copper ETF strategies, copper mining stock ETFs offer the potential for upside beyond the rise in copper prices.
• Likewise, a person entering a short futures position must deliver the metal’s equivalent quantity at the specified time.
• Given the belief that copper is a jack-of-many-solutions metal, speculation can be simpler than with other metals like gold that are seen as a store of value.
• No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

Forex and CFDs are leveraged products and can result in losses that exceed your deposits. This brokerage is not authorized by the Comissão de Valores Mobiliários (CVM) or the Brazilian Central Bank (BCB). The content of this page should not be characterized as an investment offer in Brazil or for investors residing in that country.

US and China Demand

COMEX is a part of the CME Group, and it offers a wide range of derivative products on different commodities. The CME Group is, in fact, the marketplace offering the most diverse offerings when it comes to derivatives. A standard copper futures contract comprises 25,000 pounds of copper in weight, and the price is quoted in US dollars.

The market’s trade volume has been on the rise over the years as both retail and institutional investors look to tap into this market for different purposes. This article will explain what copper futures are and how one can trade using these contracts. It is important to understand the benefits and risks involved with copper futures before placing a futures trade.

Pros & Cons of Investing In Copper

Under the exchange rule, trading in September copper futures was limited to the liquidation of open contracts, enabling dealers to pay off their contracts without delivering the metal. You can trade in copper futures on the Multi Commodity Exchange of India Limited (MCX). They are a type of bet between the contract buyer and seller on the future price of the underlying asset. Consumers and producers of copper can manage copper price risk by purchasing and selling copper futures. Copper stocks don’t have a straightforward relationship with the price of the metal, as other factors impact share prices, such as company fundamentals and breaking news. It’s important to do your research and assess which shares are right for your strategy before taking a position.

Day trading requires a high degree of self-discipline and emotional control. Some of the most well-known proprietary trading firms allow new traders to manage a non-profitable trading account for at least six months before they start to generate consistent profits. This is because it serves as a repository for the derivatives contracts that you purchase. Investors who are interested in starting to trade commodities like metals may be interested in copper. Those who prefer a set-it-and-forget-it approach will likely want to stick to index mutual funds and other, more passive, investments. All investing is subject to risk and most investments are volatile.