A commodity is a basic physical asset, traded on financial markets in the form of futures. Instead of having to trade on a futures exchange, you can use a derivative like a CFD to trade a huge variety of commodities, from popular markets like oil and gold.
You can use an IG CFD to trade commodities as futures, with a fixed expiry and all funding charges included in the initial spread. Alternatively, for key markets, you can trade commodities without expiries. This allows you to take a short term view, paying a funding charge each time you hold your position overnight. It also means you can a keep a position open indefinitely.
An individual commodity contract will be equivalent to a set amount of cash per point of movement in the commodity, priced in its base currency. For metals trades, that means that a single contract has an equivalent amount of metal: a single gold CFD, for instance, is the equivalent to 100 troy ounces of gold. Mini contracts are also available.
Find out more about commodities trading with IG