Best commodities to invest and trade in for 2026

Commodities in brief

While stocks and forex often get the lion's share of investor attention, commodities are perhaps the most important assets worldwide. This is because commodities underpin the economic system in a fundamental way; every company in the world ultimately generates profit through the commodity chain.

Commodities are split into two segments. Hard commodities are natural resources that are usually mined or extracted from the ground, such as oil, gold or copper. Soft commodities are grown and usually require maintenance during production, such as livestock, wheat or sugar.

Investing in commodities gives investors an advantage in that they provide significant diversification in a portfolio. This is because commodities' performance historically demonstrates a low correlation with other major asset classes such as cash, fixed income or stocks.

2025 proved this point emphatically. While equities experienced volatility driven by trade war fears and geopolitical tensions, the commodities sector, and in particular precious metals, delivered some of the strongest returns seen in decades. Investors who had diversified into gold, silver and copper were well rewarded.

How to invest and trade in commodities with us

To get started, learn more about commodities, open an account with us or practise on a demo, select your opportunity, choose your position size and manage your risk, then place your deal and monitor your trade.

You can either invest in commodities directly, or trade using spread betting or CFDs to benefit from leverage. We also offer many ETFs and ETCs based on commodities, and there are thousands of commodity-focused resource stocks on offer, such as Rio Tinto, Glencore and Anglo American.

Keep in mind, leverage means you can gain or lose money faster than expected. Because your position size is far greater than your deposit, you could lose more money than you put in. Past performance is not an indicator of future returns.

Exchange Traded Commodities

Exchange Traded Commodities (ETCs) are financial instruments designed to enable indirect investing and trading on commodities, without you having to take direct ownership. They act as debt instruments designed to track the performance of a single commodity or a basket of commodities, making them a popular choice for investors seeking precise exposure.

ETCs are designed to track the price of the underlying material asset, meaning their value is influenced by factors that affect the price of the commodity itself. For instance, when trading wheat, elements like weather patterns and crop yields can impact its price. Some ETCs also provide leveraged or inverse exposure, and many come with currency-hedged options to account for foreign exchange risks.

However, ETCs carry counterparty risk as they're structured as debt instruments, and their returns can be eroded by costs associated with storage or rolling futures contracts. Additionally, ETCs often focus on individual commodities, which can make them unattractive to investors seeking diversification.

Commodity Exchange Traded Funds

Exchange Traded Funds (ETFs) are far better known than ETCs. While ETCs give you exposure to commodities, ETFs do the same but often through securities such as the shares of commodity-producing companies. A commodity ETF may take its price from futures contracts rather than holding the physical asset.

Investing directly in commodities futures can be both impractical and expensive. Futures are relatively complex, typically have large contract sizes, come with margin demands, and include a component of open-ended risk. This can make them unattractive to some retail investors.

Most commonly, commodity ETFs track a benchmark index measuring the price of a single commodity or a basket of commodities. Most are synthetic ETFs which track commodity futures, and therefore may perform better or worse than the spot price of the commodity itself. One key advantage is diversification, as many commodity ETFs invest in a basket of commodities or commodity-producing companies, spreading risk. They're also highly liquid, trading like stocks on major exchanges, and physically-backed ETFs eliminate counterparty risk by holding the underlying commodity directly. However, commodity ETFs may face tracking errors, and expense ratios can be higher compared to ETCs.

Top commodities to watch

Some of the best performing commodities over the past year include:

Silver — the standout story, silver surged to all-time highs above $120 per ounce in late 2025 before consolidating, driven by a rare convergence of safe-haven demand, central bank buying and surging industrial appetite. Its role in solar panels, AI hardware and electrification infrastructure created a structural supply deficit. It currently trades around $58 per ounce following a correction from its highs, and remains in volatile price-discovery territory.

Gold — gold smashed through the $4,000 per ounce barrier and pushed towards $5,000 in 2025, posting one of its strongest annual gains on record. Elevated geopolitical tensions, sustained central bank purchases from emerging market nations and a broadly weakening US dollar drove demand. It currently trades around $4,100 per ounce, with several major banks forecasting further upside in 2026.

Copper — copper delivered its strongest annual performance since 2009, driven by supply disruptions and extraordinary demand from AI data centres, EV manufacturing and renewable energy infrastructure. Structural tightness in the copper concentrate market persists, with analysts forecasting a 2026 average price above $12,000 per tonne and a cumulative deficit projected for the years ahead.

Platinum — platinum broke out spectacularly in 2025 after years of range-bound trading. Supply concentration risks, combined with the ongoing substitution of palladium with platinum in automotive catalysts, drove the metal sharply higher. The addition of platinum group metals to the US critical minerals list added a further geopolitical premium.

Lithium — after years of price collapses following the 2022 peak, lithium staged a recovery in 2025 on the back of a major supply disruption and rebounding demand from EV and battery-storage manufacturers, though it remains well below its historic highs.

Worst performing commodities

Some of the worst performers were:

Crude oil — oil was among 2025's major disappointments and faces a bearish 2026 outlook. An oversupplied global market, driven by long-cycle projects coming online and OPEC+ decisions, has weighed heavily on prices. Despite mid-2026 spikes above $90 on Brent during the US-Iran conflict and Strait of Hormuz disruptions, forecasters expect prices to ease, with S&P Global projecting Brent to average around $87 in 2026 and other forecasters lower still. Non-OPEC supply is growing significantly faster than demand.

Iron ore — continued weakness in China's property and construction sectors has sustained the downward pressure on iron ore that began in 2024. While some base metals recovered on green energy and AI-driven demand, iron ore remains exposed to the construction cycle, where activity has stayed subdued.

Wheat — ample global wheat stocks have kept prices depressed, with no significant supply shocks to offset the surplus. Global grain markets remain well supplied, and a normalisation of weather patterns in major growing regions has prevented any meaningful price recovery.

Natural gas — US natural gas has been volatile, with steady domestic production growth suppressing prices, though cold winter demand and strong European LNG demand have driven periodic sharp reversals.

Best commodity ETFs and ETCs to watch

Below is a selection of popular ETFs and ETCs.

The Invesco Physical Gold ETC provides exposure to the price of gold by holding allocated gold bullion in JP Morgan vaults in London. It closely tracks the spot price and is backed by physical gold bars, making it a cost-effective way to invest in the metal while avoiding the complexities of futures. With gold's strong structural tailwinds, this remains a core holding for many commodity investors.

The WisdomTree Physical Silver ETC provides direct exposure to silver by holding physical silver bullion stored in HSBC vaults. After silver's historic 2025 performance, its structural supply deficit and rising industrial demand from the solar and electronics sectors keep it compelling for 2026.

The WisdomTree Copper ETC offers targeted exposure to copper price movements, tracking front-month copper futures. With copper widely cited as an analyst pick for best-performing base metal in 2026, this ETC offers a straightforward route to that theme.

The Invesco DB Agriculture fund offers exposure to a diversified portfolio of agricultural commodities, including cocoa, corn, soybeans and wheat. It provides a way to hedge against inflation or gain exposure to the agricultural sector without selecting individual soft commodity positions.

The WisdomTree WTI Crude Oil ETC offers exposure to West Texas Intermediate crude oil prices by tracking front-month crude oil futures. While the broad outlook for oil in 2026 is bearish, some traders may see oil's depressed valuations as a contrarian opportunity, or use crude ETCs as part of a hedging strategy.

What to watch in 2026

Looking into 2026, the commodity complex faces a mixed but nuanced outlook. The World Bank forecasts global commodity prices will decline modestly for a fourth consecutive year overall, but this aggregate figure masks significant divergences between sectors.

Precious metals are widely expected to remain among the leading performers. Gold enters 2026 with several major banks forecasting prices in the $4,500-$5,400 range, with some technical models pointing higher if the current macro environment of elevated debt, geopolitical uncertainty and continued central bank accumulation persists. Silver remains highly volatile in its price discovery, with some analysts pointing to a divergence between Western and Eastern market pricing.

For copper, while near-term volatility remains high given tariff uncertainty, the long-term structural case appears compelling: copper consumption is projected to rise significantly by 2040, driven by AI infrastructure, EV production, grid modernisation and renewable energy. Supply, however, is structurally slow to respond, with major greenfield mines requiring at least 10 to 15 years to come online, and existing operations facing declining ore grades.

Agricultural commodities are expected to ease gently, with stable growing conditions in most regions keeping grain, soybean and corn markets well supplied. Coffee and cattle remain potential exceptions, where supply tightness could create opportunities.

A central factor for the whole complex in 2026 is the fragile US-Iran ceasefire. An uneasy truce has allowed prices to retreat from second-quarter peaks, but any re-escalation and renewed disruption in the Strait of Hormuz poses significant upside risk to oil and industrial materials.

Best commodities summed up

• Commodities underpin the economic system in a fundamental way; every company in the world ultimately generates profit through the commodity chain
• Hard commodities are natural resources mined or extracted from the ground, such as oil, gold or copper
• Soft commodities are grown and usually require maintenance during production, such as livestock, wheat or sugar
• 2025 was a landmark year for precious metals, with silver and gold both surging to all-time highs, and several analysts expect precious metals and copper to remain among the leaders in 2026

Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise and you may get back less than you invest.

Ready to invest or trade commodities? Open a share dealing account to invest, or open a trading account to trade with leverage via spread bets and CFDs. For more, see our guides on best global ETFs and gold trading.