Commodity is a broad term that covers any basic goods that can be turned into other goods or services, and they are a great investment option. It’s important that you diversify your investments so you should look into commodities. Unfortunately, there are a lot of different options and many people don’t know where to start. If you are interested in investing in commodities but you aren’t sure where to put your money, these are some of the best options to consider. 

Gold

Gold is one of the most popular commodity investments, and for good reason. Although the value of gold can sometimes be unpredictable, it is relatively stable. In most cases, the value of gold will go up in times of economic difficulty, so it’s a good investment to make. Gold is used to make jewelry, technology, and by central banks and investors, so demand is always relatively high and that means that the value is stable. When investing in gold, you can buy the physical commodity from companies like ABC Refinery ATO and then store it in a safety deposit box. Alternatively, you can invest in a futures contract if you want to make smaller investments and don’t want to deal with the storage of the physical gold bars. 

Crude Oil

Crude oil is a great investment option because it is used for so many things. It is converted into gas and petroleum, but it is also used to make plastics, medicines, ink, cosmetics, asphalt and much more. The prices depend on supply and demand, but it is often relatively easy to determine when demand will increase. For example, gas prices often increase during the summer driving season, so crude oil will increase in value as well. Increased demand from growing economies in places like India and China also pushes up the price of crude oil, so now is a good time to invest. If you are going to invest in crude oil, it’s important that you keep up to date with current events because political issues in the Middle East, where a lot of oil is extracted, can affect prices. 

There are a few ways to invest in oil, but you can’t really buy the physical commodity because buying, storing, and selling barrels of oil isn’t really an option. Investing in futures is the best way of owning the commodity outright, but it requires a lot of capital upfront and they can be very unpredictable. In most cases, the best way to put your money into crude oil is to buy stocks in an oil company. 

Base Metals

Precious metals aren’t the only way to invest your money, you should also consider base metals. These are the simple metals that are used to make a range of commercial and industrial items. Things like aluminum, zinc or copper, for example, are always a good investment because they’re cheap and readily available, and demand is steady. Buying the commodity outright is not usually that profitable because there is so much of it out there, so buying stocks in a base metal company is your best option. 

There are a lot of different commodities to invest in and you should explore your options, but if you are looking for a good starting point, gold, crude oil, and base metals are perfect.