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Can You Really Make Money Trading Commodities Online?

Updated on September 14, 2009

As more and more people are seeing their career prospects evaporate in this recession, a growing number are turning to ways to make money online.

The online money making scenario is a pleasant Sunday stroll through a mine field. For every single enterprise that can legitimately make you money while working at home from your computer there are hundreds, and maybe thousands, that will reward you for your investment of time and energy with all of the income of a wandering minstrel in Uzbekistan. That's if you make any money at all.

In many other Hubs I've outlined many of these money making schemes and how they are essentially waste of time schemes. Yes, some people might be making money on these plans, but they are certainly few and far between. What most people can earn using these various techniques definitely makes them look very fondly towards the prospects of wandering the steppes of Uzbekistan with a dented, rusty karnay.

An online money making technique that I've been examining with various levels of interest in the past few years is online Commodity Brokerage. Now let's get our terms straight. I'm not talking about playing roulette (or Russian roulette) with placing Commodity Futures bets waiting for the price to spike and make you a zillionaire or the price to plummet and get a margin call that wipes out your house.

If you have more money than brains, by all means go play in the Commodity Futures market. If you have even a slight inkling of sanity, approach it with the same trepidation you would spending the night cuddled up in a pit of vipers.

You would also be well advised to steer clear of all sorts of speculative products, such as currencies, bonds, stock indexes and other intangibles. Stick to materials that somebody needs right now in enormous quantities. The prospect I'm talking about is acting as a go between with buyers on one side and sellers on the other side of huge amounts of a particular Commodity which exists right now and is ready to be transported today. When I say huge, I mean huge. Entire cargo ships full.

The essence of Brokerage is to negotiate between global buyers and sellers of bulk products. Usually these deals are consummated between parties living in different nations and rarely are the quantities in any particular deal below 10,000 Metric Tons (MT)... and often the deals are as large as half a million MTs. That equals 500,000,000 kilograms. Try to picture this amount. It's the weight of five million overweight people. Or more than one thousand fully loaded to the max Boeing 747s. Yeah. Most definitely not a tiny bit of stuff you can carry in a suitcase!

What kind of products? Sugar, Corn, Wheat, Soybeans, Rice, Urea... what's urea? No it's not what you do after you've had a few beers. It's a very widely used nitrogen-release fertilizer. It's used in agriculture all over the world, thus there never seems to be an end to the demand for the stuff.

Here is a full alphabetical list of some of the most common Commodities to trade in this manner:

Aluminum
Aluminum Alloy
Brent Crude
Cocoa
Coffee
Copper
Corn
Cotton
Ethanol
Gulf Coast Gasoline
Heating Oil
Lead
Natural Gas
Nickel Aluminum Alloy
Oats
Palm Oil
Polypropylene LL Density Polyethylene
Propane
Rapeseed (Canola)
Recycled Steel
Rough Rice
Rubber
Soybean Meal
Soybean Oil
Soybeans
Sugar
Tin
Wheat
Wool
WTI Crude Oil
Zinc

Continued In Can You Really Make Money Trading Commodities Online? The Mighty FCO

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