Buying commodity stocks with share dealing
Open a share dealing account to buy and hold commodity stocks and own them outright. You can make profit if you sell them at a higher price and earn dividends if the company grants them.
With us, you’ll get exposure to international stocks or ETFs with zero commission to pay on US share trades.1
Note that share dealing isn’t leveraged, which means you’ll have to put up the full value of the position when opening it. When you own equity in a company, you’ll have shareholder voting rights.
Trading commodity stocks with spread betting
When spread betting, you’re staking an amount of money per point of price movement in the underlying asset. You’ll speculate on rising or falling markets by going long if you think that the price will rise or go short if you think that it’ll fall.
Spread bets are popular because you can trade without paying capital gains tax or stamp duty.2 Additionally, you can trade spread bets on leverage, which means that you’ll put down a small initial deposit – known as margin – to open a position.
Trading commodity stocks with CFD trading
With CFD trading, you’ll enter into an agreement to exchange the difference in price from the point at which the contract is opened to when it’s closed. Like with spread bets, you can go long and short to predict the direction of the underlying market price.
CFDs can be a useful tool to hedge your portfolio for tax-deductible purposes.2 They can also be traded on leverage to magnify your profits with just a fraction of the size value to open the position.
Remember that while leverage can amplify your profit, you stand to lose far more than your initial deposit. That’s why you need to take steps to manage your risk effectively.
