Commodities trading boom raises fear of big losses among retail investors

Financial Times/Madison Darbyshire and Nicholas Megaw/1-2-2023

“Growing numbers of retail investors are being drawn into commodity trading after two consecutive years of bumper returns, despite concerns that they could suffer huge losses or disrupt the complex and volatile markets.”

USAGOLD note: Commodities investors on the futures exchanges own leveraged positions, and as one analyst pointed out, “these are very sophisticated markets where you can lose . . . whatever you put up with your [broker] in a matter of minutes.” By owning physical gold and silver outright, you can participate in any future commodities rally without exposing yourself to the dangers of leverage. In fact, you can ride out any downside and live to potentially profit another day. The commodities’ futures markets are not for everyone – a lesson too many learn the hard way.