When investing and trading comes to mind, there is a good chance you’ll think about adding commodity to your portfolio. But how and why would you trade commodities like gold, silver, or crude oil? Learn the basics of trading in this asset class using this guide and our DeFi trading platform to provide you greater confidence and ease to trade. 


Before we begin trading

You will need to set up your Level01 app. It is easy to set up and will only take a few minutes:


A Brief Overview on Trading Commodity

A commodity is a basic good used in commerce that is interchangeable with other goods of the same type. Examples include grain, gold, beef, gold, or natural gas. This asset class is an important way to diversify your investment portfolio beyond stocks, bonds, or crypto. Commodities tend to move in opposition to stocks and present trading opportunities for investors during market volatility. 

On the Level01 app, you can trade commodity derivatives. These are financial instruments whose value is based on underlying commodities, such as oil, gas, or metals. The app currently offers three primary commodities for trade: Crude Oil, Gold, and Silver. You can speculate on the price movements of the market using the app by using the native LVX tokens.

To check on the current LVX/USDT price, click here.


How To Trade Commodity On Level01 App

1. Enter the app and click on Markets via the main menu, then select Commodity. In this guide, we will use Gold as an example.

You can choose Crude Oil, Gold or Silver. Click on the icon with the star to place it in your “Favorite” List

 

2. Study the chart to see if the Gold market has been bullish or bearish, then determine your trading strategy. Next, click on the new contract button.

 

It looks like Gold is on a downward trend. Below the chart, you can also choose to trade with any peer contract as you like.

 

3.  Set your commodity contract’s expiry date by selecting the day, date time, and determine your strike price (i.e. the position you want to take). As you select the strike price of your choice, you will see that your win rate and percentage of profit adjusts as you choose different prices. This is our proprietary FairSense AI. It predicts your winning chances based on real-time data from Bloomberg. In this example, we have set the contract to expire on Monday, 30th November 2020 at 14:00pm, with a strike price of 1772.00.

Set your contract details and strike price, noting the predictions by Level01 FairSense AI.

 

4. If you are a conservative trader, begin with a small percentage of what you have in your wallet. Here, you can choose to trade using LVX or ETH. The minimum required amount to trade is 100 LVX. We’ve chosen to place 300 LVX tokens in this example.

Decide on your tradeline. You can also choose to give premiums or discounts to entice other traders to take up your contract.

 

5. Click on the document icon on your top right to view your contracts. You will see your new contract under the Created section.

View your newly created contract.

 

6. If your contract offer is accepted, you can view it under the Matched Section.

Your contract is matched.

 

7. At the designated time of settlement, review the Settled section to see if you have won or lost.

You can check your wins or losses once your contract is settled. Your wallet will also be updated accordingly.

 

Now is the Best Time to Invest in Commodity

According to former Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein, now is a good time to invest in commodities because the prices are lower. In his interview with Bloomberg, Blankfein says, “From an inflation point of view, as an investor, I think investing in material sectors while they’re under-appreciated is not a bad thing now.” 

While crypto trading looks exciting, commodity trading can offer diversification and risk management. You can also use Level01’s AI-Guided Derivative Trading App for its FairSense AI risk and reward projections and quick trade executions with smart contract settlements to give you an added advantage. 

For those who are just starting, you can train in terms of skill, knowledge, and emotions by reading books, going for suitable commodity derivatives trading workshops, and practicing with the Demo version of this app. Practice does make perfect. There is a trading contest happening now till 31st December 2020. In this contest, you trade with your demo account to win actual LVX tokens in your real account. Winners stand to win 10,000 LVX – 20,000 LVX in their wallets. Read the contest details here.

 

Try the World’s 1st DeFi Platform with AI-Guided Derivatives Trading APP: Level01 APP

APP Quickstart Guide: https://level01.io/quickstart-trading-guide/