Commodities are the raw materials that we use for sustaining lives. Some of the examples are energy and fuel, agricultural products, and metals. Metals, agricultural products, and energy are three classes of market commodities. These are the essential pillars of the global economy.
Criteria that commodities need to fulfill
Commodities need to fulfill these three criteria:
Tradability: Tradable commodities needs to have values that can be used as production materials of other goods or servicers.
Deliverability: Can you physically deliver the commodities to the buyers?
Liquidity: Commodities’ liquidity offers you an opportunity to get in and out of an investment easily.