What is wheat trading?
Wheat trading involves speculating in upward or downward movements in wheat prices without owning the underlying commodity. You can trade with the increase or decrease in prices.
Wheat is classified as a “soft” commodity because it is a natural commodity that is grown, harvested and processed for human consumption. This differs from “hard” raw materials, which are mined or mined from the earth and used for manufacturing.
The raw materials are mass-produced and the price is standardized, meaning it is the same all over the world. Like stocks, commodities are bought and sold on specialized exchanges. The only difference, however, is that commodities can be bought and sold at current or future prices, a key factor traders should consider when considering adding wheat to their portfolio. Factors that can affect the price of wheat include political news or events, seasonal cycles and weather.
Learn more about raw materials and how to trade them