Commodities are physical substance, such as food, grains, and metals, which is interchangeable with another product of the same type, and which investors buy or sell, usually through futures contracts. The price of the commodity is subject to supply and demand. Risk is actually the reason exchange trading of the basic agricultural products began. For example, a farmer risks the cost of producing a product ready for market at sometime in the future because he doesn't know what the selling price will be.
But in general, commodities are any product that trades on a commodity exchange, which also includes foreign currencies and financial instruments and trading.It is actually the contract and the underlying standard that defines the commodity, not any quality inherent to the product.
And that is where commodities futures exchange graphs come to be important. A futures exchange is a central financial exchange where people can trade standardized futures contracts; that is, a contract to buy specific quantities of a commodity or financial instrument at a specified price with delivery set at a specified time in the future.
Traders rely on these charts to be able to determine whether a commodity is interchangeable in a futures exchange which is a central financial exchange where people can trade contracts to buy specific quantities of a commodity or financial instrument at a specified price with delivery set at a specified time in the future
