Globalization in Business With History and Pros and Cons
One clear result of globalization is that an economic downturn in one country can have a domino effect on its trade partners. Globalization. Alex Dos Diaz / ...
commodities
Globalization is not a new concept. Traders traveled vast distances in ancient times to buy <anchor>commodities</anchor> that were rare and expensive for sale in their homelands. The Industrial Revolution brought advances in transportation and communication in the 19th century that eased trade across borders.
What Are Commodities and Understanding Their Role in the Stock Market
What Are Commodities and Understanding Their Role in the Stock Market

[Skip to content](#skip-to-content)

[Investopedia Homepage](/)

- [Investing](https://www.investopedia.com/investing-4427685)  - [Stocks](https://www.investopedia.com/stocks-4427785)
  - [Cryptocurrency](https://www.investopedia.com/cryptocurrency-4427699)
  - [Bonds](https://www.investopedia.com/bonds-4689778)
  - [ETFs](https://www.investopedia.com/etfs-4427784)
  - [Options and Derivatives](https://www.investopedia.com/options-and-derivatives-trading-4689663)
  - [Commodities](https://www.investopedia.com/commodities-4427780)
  - [Trading](https://www.investopedia.com/trading-4427765)
  - [Automated Investing](https://www.investopedia.com/financial-technology-and-automated-investing-4689759)
  - [Brokers](https://www.investopedia.com/brokers-4689772)
  - [Fundamental Analysis](https://www.investopedia.com/fundamental-analysis-4689757)
  - [Markets](https://www.investopedia.com/markets/)
  - [View All](https://www.investopedia.com/investing-4427685)
- [Simulator](https://www.investopedia.com/simulator/?inv_to_sim=global_nav)  - [Login / Portfolio](https://www.investopedia.com/simulator/portfolio)
  - [Trade](https://www.investopedia.com/simulator/trade/stocks)
  - [Research](https://www.investopedia.com/simulator/research)
  - [My Games](https://www.investopedia.com/simulator/games/my-games)
  - [Leaderboard](https://www.investopedia.com/simulator/games)
- [Banking](https://www.investopedia.com/banking-4427754)  - [Savings Accounts](https://www.investopedia.com/savings-accounts-4689728)
  - [Certificates of Deposit (CDs)](https://www.investopedia.com/certificate-of-deposits-4689733)
  - [Money Market Accounts](https://www.investopedia.com/money-market-account-4689730)
  - [Checking Accounts](https://www.investopedia.com/checking-accounts-4689732)
  - [View All](https://www.investopedia.com/banking-4427754)
- [Personal Finance](https://www.investopedia.com/personal-finance-4427760)  - [Budgeting and Saving](https://www.investopedia.com/budgeting-and-savings-4427755)
  - [Personal Loans](https://www.investopedia.com/personal-loans-4689729)
  - [Insurance](https://www.investopedia.com/insurance-4427716)
  - [Mortgages](https://www.investopedia.com/mortgage-4689703)
  - [Credit and Debt](https://www.investopedia.com/credit-and-debt-4689724)
  - [Student Loans](https://www.investopedia.com/student-loans-4689727)
  - [Taxes](https://www.investopedia.com/taxes-4427724)
  - [Credit Cards](https://www.investopedia.com/credit-card-4689721)
  - [Financial Literacy](https://www.investopedia.com/financial-literacy-resource-center-7151950)
  - [Retirement](https://www.investopedia.com/retirement-planning-4689695)
  - [View All](https://www.investopedia.com/personal-finance-4427760)
- [Economy](https://www.investopedia.com/economy-4689801)  - [Government and Policy](https://www.investopedia.com/government-and-policy-4689793)
  - [Monetary Policy](https://www.investopedia.com/monetary-policy-4689792)
  - [Fiscal Policy](https://www.investopedia.com/fiscal-policy-4689796)
  - [Economics](https://www.investopedia.com/economics-4689800)
  - [View All](https://www.investopedia.com/economy-4689801)
- [News](https://www.investopedia.com/news-4427706)  - [Markets](https://www.investopedia.com/markets-news-4427704)
  - [Companies](https://www.investopedia.com/company-news-4427705)
  - [Earnings](https://www.investopedia.com/earnings-reports-5218419)
  - [CD Rates](https://www.investopedia.com/certificates-deposit-news-7111770)
  - [Mortgage Rates](https://www.investopedia.com/mortgage-rates-5184598)
  - [Economy](https://www.investopedia.com/economic-news-5218422)
  - [Government](https://www.investopedia.com/political-news-4689737)
  - [Crypto](https://www.investopedia.com/cryptocurrency-news-5114163)
  - [ETFs](https://www.investopedia.com/etf-news-5218416)
  - [Personal Finance](https://www.investopedia.com/personal-finance-news-5114159)
  - [View All](https://www.investopedia.com/news-4427706)
- [Reviews](https://www.investopedia.com/financial-product-reviews-7110783)  - [Best Online Brokers](https://www.investopedia.com/best-online-brokers-4587872)
  - [Best Savings Rates](https://www.investopedia.com/best-high-yield-savings-accounts-4770633)
  - [Best CD Rates](https://www.investopedia.com/best-cd-rates-4770214)
  - [Best Life Insurance](https://www.investopedia.com/best-life-insurance-companies-4845858)
  - [Best Personal Loans](https://www.investopedia.com/best-personal-loans-4773300)
  - [Best Mortgage Rates](https://www.investopedia.com/mortgage-rates-5094943)
  - [Best Money Market Accounts](https://www.investopedia.com/best-money-market-accounts-5096917)
  - [Best Auto Loan Rates](https://www.investopedia.com/best-auto-loan-rates-4846394)
  - [Best Credit Repair Companies](https://www.investopedia.com/best-credit-repair-companies-4843898)
  - [Best Credit Cards](https://www.investopedia.com/best-credit-cards-4801582)
  - [View All](https://www.investopedia.com/financial-product-reviews-7110783)

[Live](https://www.investopedia.com/dow-jones-today-09132024-8711980)

- SearchSearch






Please fill out this field.


SearchSearch

Please fill out this field.

- [Investing](https://www.investopedia.com/investing-4427685)


Investing



- [Stocks](https://www.investopedia.com/stocks-4427785)
- [Cryptocurrency](https://www.investopedia.com/cryptocurrency-4427699)
- [Bonds](https://www.investopedia.com/bonds-4689778)
- [ETFs](https://www.investopedia.com/etfs-4427784)
- [Options and Derivatives](https://www.investopedia.com/options-and-derivatives-trading-4689663)
- [Commodities](https://www.investopedia.com/commodities-4427780)
- [Trading](https://www.investopedia.com/trading-4427765)
- [Automated Investing](https://www.investopedia.com/financial-technology-and-automated-investing-4689759)
- [Brokers](https://www.investopedia.com/brokers-4689772)
- [Fundamental Analysis](https://www.investopedia.com/fundamental-analysis-4689757)
- [Markets](https://www.investopedia.com/markets/)
- [View All](https://www.investopedia.com/investing-4427685)

- [Simulator](https://www.investopedia.com/simulator/?inv_to_sim=global_nav)


Simulator



- [Login / Portfolio](https://www.investopedia.com/simulator/portfolio)
- [Trade](https://www.investopedia.com/simulator/trade/stocks)
- [Research](https://www.investopedia.com/simulator/research)
- [My Games](https://www.investopedia.com/simulator/games/my-games)
- [Leaderboard](https://www.investopedia.com/simulator/games)

- [Banking](https://www.investopedia.com/banking-4427754)


Banking



- [Savings Accounts](https://www.investopedia.com/savings-accounts-4689728)
- [Certificates of Deposit (CDs)](https://www.investopedia.com/certificate-of-deposits-4689733)
- [Money Market Accounts](https://www.investopedia.com/money-market-account-4689730)
- [Checking Accounts](https://www.investopedia.com/checking-accounts-4689732)
- [View All](https://www.investopedia.com/banking-4427754)

- [Personal Finance](https://www.investopedia.com/personal-finance-4427760)


Personal Finance



- [Budgeting and Saving](https://www.investopedia.com/budgeting-and-savings-4427755)
- [Personal Loans](https://www.investopedia.com/personal-loans-4689729)
- [Insurance](https://www.investopedia.com/insurance-4427716)
- [Mortgages](https://www.investopedia.com/mortgage-4689703)
- [Credit and Debt](https://www.investopedia.com/credit-and-debt-4689724)
- [Student Loans](https://www.investopedia.com/student-loans-4689727)
- [Taxes](https://www.investopedia.com/taxes-4427724)
- [Credit Cards](https://www.investopedia.com/credit-card-4689721)
- [Financial Literacy](https://www.investopedia.com/financial-literacy-resource-center-7151950)
- [Retirement](https://www.investopedia.com/retirement-planning-4689695)
- [View All](https://www.investopedia.com/personal-finance-4427760)

- [Economy](https://www.investopedia.com/economy-4689801)


Economy



- [Government and Policy](https://www.investopedia.com/government-and-policy-4689793)
- [Monetary Policy](https://www.investopedia.com/monetary-policy-4689792)
- [Fiscal Policy](https://www.investopedia.com/fiscal-policy-4689796)
- [Economics](https://www.investopedia.com/economics-4689800)
- [View All](https://www.investopedia.com/economy-4689801)

- [News](https://www.investopedia.com/news-4427706)


News



- [Markets](https://www.investopedia.com/markets-news-4427704)
- [Companies](https://www.investopedia.com/company-news-4427705)
- [Earnings](https://www.investopedia.com/earnings-reports-5218419)
- [CD Rates](https://www.investopedia.com/certificates-deposit-news-7111770)
- [Mortgage Rates](https://www.investopedia.com/mortgage-rates-5184598)
- [Economy](https://www.investopedia.com/economic-news-5218422)
- [Government](https://www.investopedia.com/political-news-4689737)
- [Crypto](https://www.investopedia.com/cryptocurrency-news-5114163)
- [ETFs](https://www.investopedia.com/etf-news-5218416)
- [Personal Finance](https://www.investopedia.com/personal-finance-news-5114159)
- [View All](https://www.investopedia.com/news-4427706)

- [Reviews](https://www.investopedia.com/financial-product-reviews-7110783)


Reviews



- [Best Online Brokers](https://www.investopedia.com/best-online-brokers-4587872)
- [Best Savings Rates](https://www.investopedia.com/best-high-yield-savings-accounts-4770633)
- [Best CD Rates](https://www.investopedia.com/best-cd-rates-4770214)
- [Best Life Insurance](https://www.investopedia.com/best-life-insurance-companies-4845858)
- [Best Personal Loans](https://www.investopedia.com/best-personal-loans-4773300)
- [Best Mortgage Rates](https://www.investopedia.com/mortgage-rates-5094943)
- [Best Money Market Accounts](https://www.investopedia.com/best-money-market-accounts-5096917)
- [Best Auto Loan Rates](https://www.investopedia.com/best-auto-loan-rates-4846394)
- [Best Credit Repair Companies](https://www.investopedia.com/best-credit-repair-companies-4843898)
- [Best Credit Cards](https://www.investopedia.com/best-credit-cards-4801582)
- [View All](https://www.investopedia.com/financial-product-reviews-7110783)

- [Financial Terms](https://www.investopedia.com/financial-term-dictionary-4769738)
- [Newsletter](https://www.investopedia.com/investopedia-newsletter-opt-in-7095821)
- [About Us](https://www.investopedia.com/about-us-5093223)

Follow Us

- [Visit Investopedia's Facebook](https://www.facebook.com/Investopedia/)
- [Visit Investopedia's Instagram](https://www.instagram.com/investopedia/?hl=en)
- [Visit Investopedia's LinkedIn](https://www.linkedin.com/company/investopedia-ulc)
- [Visit Investopedia's TikTok](https://www.tiktok.com/@investopedia)
- [Visit Investopedia's X](https://twitter.com/investopedia)
- [Visit Investopedia's YouTube](https://www.youtube.com/c/investopedia)

Table of Contents

Expand

Table of Contents

- [What Are Commodities?](#toc-what-are-commodities)

- [Understanding Commodities](#toc-understanding-commodities)

- [Buyers and Producers](#toc-buyers-and-producers-of-commodities)

- [Commodities Speculators](#toc-commodities-speculators)

- [Special Considerations](#toc-special-considerations)

- [Commodities FAQs](#toc-what-is-the-relationship-between-commodities-and-derivatives)

- [The Bottom Line](#toc-the-bottom-line)


- [Economy](https://www.investopedia.com/economy-4689801)
- [Economics](https://www.investopedia.com/economics-4689800)

# What Are Commodities and Understanding Their Role in the Stock Market

By

[Jason Fernando](https://www.investopedia.com/contributors/53746/)

[Full Bio](https://www.investopedia.com/contributors/53746/)

- [Visit Jason Fernando's LinkedIn](https://www.linkedin.com/in/jasonfernando/)

Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems.

Learn about our [editorial policies](/legal-4768893#editorial-policy)

Updated June 27, 2024

Reviewed by

[Robert C. Kelly](https://www.investopedia.com/robert-c-kelly-4799779)

Reviewed byRobert C. Kelly

[Full Bio](https://www.investopedia.com/robert-c-kelly-4799779)

Robert Kelly is managing director of XTS Energy LLC, and has more than three decades of experience as a business executive. He is a professor of economics and has raised more than $4.5 billion in investment capital.

Learn about our [Financial Review Board](/investopedia-financial-review-board-5076269)

Fact checked by

[Vikki Velasquez](https://www.investopedia.com/vikki-velasquez-5198872)

Fact checked byVikki Velasquez

[Full Bio](https://www.investopedia.com/vikki-velasquez-5198872)

- [Visit Jason Fernando's LinkedIn](https://www.linkedin.com/in/vikkivelasquez/)

Vikki Velasquez is a researcher and writer who has managed, coordinated, and directed various community and nonprofit organizations. She has conducted in-depth research on social and economic issues and has also revised and edited educational materials for the Greater Richmond area.

Learn about our [editorial policies](/legal-4768893#editorial-policy)

Part of the Series

Global Trade Guide

Tariffs

1. [International (Global) Trade: Definition, Benefits, and Criticisms](https://www.investopedia.com/insights/what-is-international-trade/)
2. [What are Tariffs?](https://www.investopedia.com/news/what-are-tariffs-and-how-do-they-affect-you/)
3. [Tariffs and Trade Barriers](https://www.investopedia.com/articles/economics/08/tariff-trade-barrier-basics.asp)
4. [Trade Wars](https://www.investopedia.com/terms/t/trade-war.asp)
5. [How Would a Trade War Affect You?](https://www.investopedia.com/insights/how-would-trade-war-affect-you/)
6. [Who Has the Highest Tariffs?](https://www.investopedia.com/ask/answers/040115/which-countries-have-highest-tariffs.asp)
7. [Protectionism](https://www.investopedia.com/terms/p/protectionism.asp)

Global Players

1. [The Plaza Accord](https://www.investopedia.com/terms/p/plaza-accord.asp)
2. [Currency Wars](https://www.investopedia.com/articles/forex/042015/what-currency-war-how-does-it-work.asp)
3. [Factors Driving the USD](https://www.investopedia.com/articles/forex/09/factors-drive-american-dollar.asp)
4. [Emerging Markets: The Parts of Russia's GDP](https://www.investopedia.com/articles/investing/120615/emerging-markets-analyzing-russias-gdp.asp)
5. [How OPEC (and Non-OPEC) Production Affects Oil Prices](https://www.investopedia.com/articles/investing/012216/how-opec-and-nonopec-production-affects-oil-prices.asp)
6. [BRICS: Acronym for Brazil, Russia, India, China, and South Africa](https://www.investopedia.com/terms/b/brics.asp)
7. [The Economy of Canada](https://www.investopedia.com/articles/investing/042315/fundamentals-how-canada-makes-its-money.asp)

Currency & Exchange Rates

1. [How Currency Fluctuations Affect the Economy](https://www.investopedia.com/articles/forex/080613/effects-currency-fluctuations-economy.asp)
2. [Devaluation](https://www.investopedia.com/terms/d/devaluation.asp)
3. [Manipulation](https://www.investopedia.com/terms/m/manipulation.asp)
4. [Revaluation](https://www.investopedia.com/terms/r/revaluation.asp)
5. [What is Fiat Money?](https://www.investopedia.com/terms/f/fiatmoney.asp)
6. [Yuan vs. Renminbi: What's the Difference?](https://www.investopedia.com/articles/forex/061115/yuan-vs-rmb-understanding-difference.asp)
7. [What Causes a Currency Crisis?](https://www.investopedia.com/articles/economics/08/currency-crises.asp)

Cryptocurrencies and Global Trade

1. [South Korea's Ties to Crypto](https://www.investopedia.com/news/why-south-korea-so-important-bitcoin-prices/)
2. [El Salvador Breaks Ground on Crypto](https://www.investopedia.com/el-salvador-accepts-bitcoin-as-legal-tender-5200470)
3. [Sweden Takes First Steps on Crypto](https://www.investopedia.com/sweden-takes-another-step-toward-a-digital-currency-5092069)

Commodities

1. [What is a Commodity?](https://www.investopedia.com/terms/c/commodity.asp)
CURRENT ARTICLE

2. [Tradable Commodities](https://www.investopedia.com/ask/answers/022315/what-are-tradable-commodities.asp)
3. [Commodities Index](https://www.investopedia.com/terms/c/commodityindices.asp)
4. [10 Countries With The Most Natural Resources](https://www.investopedia.com/articles/markets-economy/090516/10-countries-most-natural-resources.asp)
5. [What Causes Oil Prices to Fluctuate?](https://www.investopedia.com/ask/answers/012715/what-causes-oil-prices-fluctuate.asp)
6. [What is a Crypto Commodity?](https://www.investopedia.com/terms/c/crypto-commodity.asp)

## What Are Commodities?

Commodities are raw materials used to manufacture consumer products. They are inputs in the production of other goods and services, rather than finished goods sold to consumers.

In commerce, commodities are basic resources that are interchangeable with other goods of the same type. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When traded on an exchange, commodities must also meet specified minimum standards, also known as a [basis grade](https://www.investopedia.com/terms/b/basisgrade.asp).

### Key Takeaways

- A commodity is a basic good used in commerce that is interchangeable with other commodities of the same type.
- Commodities are most often used as inputs in the production of other goods or services.
- Investors and traders can buy and sell commodities directly in the spot (cash) market or via derivatives such as futures and options.
- Hard commodities refer to energy and metals products, while soft commodities are often agricultural goods.
- Many investors view allocating commodities in a portfolio as a hedge against inflation.

Investopedia / Joules Garcia

## Understanding Commodities

Commodities are the raw inputs used in the production of goods. They may also be basic staples such as certain agricultural products. The important feature of a commodity is that there is very little differentiation in that good, regardless of who produces it. A barrel of oil is basically the same product, regardless of the producer. The same goes for a bushel of wheat or a ton of ore. By contrast, the quality and features of a given consumer product will often be quite different depending on the producer (e.g., Coke vs. Pepsi).

Some traditional examples of commodities include grains, gold, beef, oil, and natural gas. More recently, the definition has expanded to include financial products, such as foreign currencies and indexes.

[Commodities can be bought and sold](https://www.investopedia.com/commodities-4427780) on specialized exchanges as financial assets. There are also well-developed derivatives markets whereby you can buy contracts on such commodities (e.g., oil forwards, wheat or gold futures, and [natural gas options](https://www.investopedia.com/articles/active-trading/010715/trading-natural-gas-options.asp)). Some experts believe that investors should hold at least some portion of a well-diversified portfolio in commodities since they are not highly correlated with other financial assets and may serve as an inflation hedge.

You might consider allocating up to 10% of your portfolio to a mix of commodities. Ordinary investors can look to one of several [commodities ETFs](https://www.investopedia.com/terms/c/commodity-etf.asp) or mutual funds to gain exposure.

## Buyers and Producers of Commodities

The sale and purchase of commodities are usually carried out through [futures](https://www.investopedia.com/terms/f/futures.asp) contracts on exchanges that standardize the quantity and minimum quality of the commodity being traded. For example, the [Chicago Board of Trade (CBOT)](https://www.investopedia.com/terms/c/cbot.asp) stipulates that one wheat contract is for 5,000 bushels and states what grades of wheat can be used to satisfy the contract.

Two types of traders trade commodity futures. The first are buyers and producers of commodities that use commodity futures contracts for the hedging purposes for which they were originally intended. These traders make or take delivery of the actual commodity when the futures contract expires.

For example, the wheat farmer who plants a crop can hedge against the risk of losing money if the price of wheat falls before the crop is harvested. The farmer can sell wheat futures contracts when the crop is planted and have a guaranteed, predetermined price for the wheat when it is harvested.

## Commodities Speculators

The second type of commodities trader is the [speculator](https://www.investopedia.com/terms/s/speculator.asp). These are traders who trade in the commodities markets for the sole purpose of profiting from the volatile price movements. These traders never intend to make or take delivery of the actual commodity when the futures contract expires.

Many futures markets are very liquid and have a high degree of daily range and volatility, making them very tempting markets for intraday traders. Many index futures are used by brokerages and portfolio managers to offset risk. Also, since commodities do not typically trade in tandem with equity and bond markets, some commodities can be used effectively to diversify an investment portfolio.

## Special Considerations

Commodity prices typically rise when [inflation](https://www.investopedia.com/terms/i/inflation.asp) accelerates, which is why investors often flock to them for their [protection](https://www.investopedia.com/articles/investing/081315/9-top-assets-protection-against-inflation.asp) during times of increasing inflation—particularly when it is unexpected. So, commodity demand increases because investors flock to them, raising their prices. The prices of goods and services then go up to match the increase. This causes commodities to often serve as a hedge against a currency's decreased buying power when the inflation rate increases.

## What Is the Relationship Between Commodities and Derivatives?

The modern commodities market relies heavily on derivative securities, such as futures and forward contracts. Buyers and sellers can transact with one another easily and in large volumes without needing to exchange the physical commodities themselves. Many buyers and sellers of commodity derivatives do so to speculate on the price movements of the underlying commodities for purposes such as risk hedging and inflation protection.

## What Determines Commodity Prices?

Like all assets, commodity prices are ultimately determined by [supply and demand](https://www.investopedia.com/terms/l/law-of-supply-demand.asp). For example, a booming economy might lead to increased demand for oil and other energy commodities. Supply and demand for commodities can be impacted in many ways, such as economic shocks, natural disasters, and investor appetite (investors may purchase commodities as an inflation hedge if they expect inflation to rise).

## What Is the Difference Between a Commodity and a Security or Asset?

Commodities are physical products that are meant to be consumed or used in the production process. Assets, on the other hand, are goods that are not consumed through their use. For instance, money or a piece of machinery are used for productive purposes, but persist as they are used. A security is a financial instrument that is not a physical product. It is a legal representation (e.g., a contract or claim) that represents certain cash flows generated from various activities (such as a stock representing the future cash flows of a business).

## What Are the Types of Commodities?

Hard commodities are usually classified as those that are mined or extracted from the earth. These can include metals, ore, and petroleum (energy) products. [Soft commodities](https://www.investopedia.com/terms/s/softcommodity.asp) instead refer to those that are grown, such as agricultural products. These include wheat, cotton, coffee, sugar, soybeans, and other harvested items.

## Where Are Commodities Traded?

The major U.S. commodity exchanges are ICE Futures U.S. and the CME Group, which operate four major exchanges: the Chicago Board of Trade (CBOT), the Chicago Mercantile Exchange (CME), the New York Mercantile Exchange (NYMEX), and the Commodity Exchange, Inc. (COMEX). There are also major [commodities exchanges](https://www.investopedia.com/terms/c/commoditiesexchange.asp) located around the world.

## The Bottom Line

Commodities are basic goods and materials that are widely used and are not meaningfully differentiated from one another. Examples of commodities include barrels of oils, bushels of wheat, or megawatt-hours of electricity. Commodities have long been an important part of commerce, but in recent decades, commodities trading has become increasingly standardized.

Article Sources

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our
[editorial policy.](https://www.investopedia.com/legal-4768893#EditorialPolicy)

1. Library of Congress. " [Commodities: A Resource Guide](https://guides.loc.gov/commodities/introduction)."

2. Financial Industry Regulatory Authority. " [Futures and Commodities: Overview](https://www.finra.org/investors/investing/investment-products/futures-and-commodities#overview)."

3. CME Group. " [Wheat Futures and Options](https://www.cmegroup.com/education/brochures-and-handbooks/wheat-futures-and-options.html)."

4. CME Group. " [Commodities as an Inflation Hedge](https://www.cmegroup.com/insights/economic-research/2022/commodities-as-an-inflation-hedge.html)."

5. Vanguard. " [The (Unexpected) Inflation-Fighting Power of Commodities](https://corporate.vanguard.com/content/corporatesite/us/en/corp/articles/inflation-fighting-power-of-commodities.html)."


Open a New Bank Account

Advertiser Disclosure

×

The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.

Part of the Series

Global Trade Guide

Tariffs

1. [International (Global) Trade: Definition, Benefits, and Criticisms](https://www.investopedia.com/insights/what-is-international-trade/)
2. [What are Tariffs?](https://www.investopedia.com/news/what-are-tariffs-and-how-do-they-affect-you/)
3. [Tariffs and Trade Barriers](https://www.investopedia.com/articles/economics/08/tariff-trade-barrier-basics.asp)
4. [Trade Wars](https://www.investopedia.com/terms/t/trade-war.asp)
5. [How Would a Trade War Affect You?](https://www.investopedia.com/insights/how-would-trade-war-affect-you/)
6. [Who Has the Highest Tariffs?](https://www.investopedia.com/ask/answers/040115/which-countries-have-highest-tariffs.asp)
7. [Protectionism](https://www.investopedia.com/terms/p/protectionism.asp)

Global Players

1. [The Plaza Accord](https://www.investopedia.com/terms/p/plaza-accord.asp)
2. [Currency Wars](https://www.investopedia.com/articles/forex/042015/what-currency-war-how-does-it-work.asp)
3. [Factors Driving the USD](https://www.investopedia.com/articles/forex/09/factors-drive-american-dollar.asp)
4. [Emerging Markets: The Parts of Russia's GDP](https://www.investopedia.com/articles/investing/120615/emerging-markets-analyzing-russias-gdp.asp)
5. [How OPEC (and Non-OPEC) Production Affects Oil Prices](https://www.investopedia.com/articles/investing/012216/how-opec-and-nonopec-production-affects-oil-prices.asp)
6. [BRICS: Acronym for Brazil, Russia, India, China, and South Africa](https://www.investopedia.com/terms/b/brics.asp)
7. [The Economy of Canada](https://www.investopedia.com/articles/investing/042315/fundamentals-how-canada-makes-its-money.asp)

Currency & Exchange Rates

1. [How Currency Fluctuations Affect the Economy](https://www.investopedia.com/articles/forex/080613/effects-currency-fluctuations-economy.asp)
2. [Devaluation](https://www.investopedia.com/terms/d/devaluation.asp)
3. [Manipulation](https://www.investopedia.com/terms/m/manipulation.asp)
4. [Revaluation](https://www.investopedia.com/terms/r/revaluation.asp)
5. [What is Fiat Money?](https://www.investopedia.com/terms/f/fiatmoney.asp)
6. [Yuan vs. Renminbi: What's the Difference?](https://www.investopedia.com/articles/forex/061115/yuan-vs-rmb-understanding-difference.asp)
7. [What Causes a Currency Crisis?](https://www.investopedia.com/articles/economics/08/currency-crises.asp)

Cryptocurrencies and Global Trade

1. [South Korea's Ties to Crypto](https://www.investopedia.com/news/why-south-korea-so-important-bitcoin-prices/)
2. [El Salvador Breaks Ground on Crypto](https://www.investopedia.com/el-salvador-accepts-bitcoin-as-legal-tender-5200470)
3. [Sweden Takes First Steps on Crypto](https://www.investopedia.com/sweden-takes-another-step-toward-a-digital-currency-5092069)

Commodities

1. [What is a Commodity?](https://www.investopedia.com/terms/c/commodity.asp)
CURRENT ARTICLE

2. [Tradable Commodities](https://www.investopedia.com/ask/answers/022315/what-are-tradable-commodities.asp)
3. [Commodities Index](https://www.investopedia.com/terms/c/commodityindices.asp)
4. [10 Countries With The Most Natural Resources](https://www.investopedia.com/articles/markets-economy/090516/10-countries-most-natural-resources.asp)
5. [What Causes Oil Prices to Fluctuate?](https://www.investopedia.com/ask/answers/012715/what-causes-oil-prices-fluctuate.asp)
6. [What is a Crypto Commodity?](https://www.investopedia.com/terms/c/crypto-commodity.asp)

Open a New Bank Account

Advertiser Disclosure

×

The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.

Related Terms

[Manipulation: Definition, Methods, Types, and Example](https://www.investopedia.com/terms/m/manipulation.asp)

Market manipulation is conduct designed to deceive investors by controlling or artificially affecting the price of securities.

[more](https://www.investopedia.com/terms/m/manipulation.asp)

[Black Wednesday: Definition, Causes, Role of George Soros](https://www.investopedia.com/terms/b/black-wednesday.asp)

On a day remembered as Black Wednesday, a collapse in the pound sterling forced Britain to withdraw from the European Exchange Rate Mechanism on Sept. 16, 1992.

[more](https://www.investopedia.com/terms/b/black-wednesday.asp)

[Trade Wars: History, Pros & Cons, and U.S.-China Example](https://www.investopedia.com/terms/t/trade-war.asp)

A trade war arises when one country retaliates against another by raising import tariffs or placing other restrictions on the other country's imports.

[more](https://www.investopedia.com/terms/t/trade-war.asp)

[Plaza Accord: Definition, History, Purpose, and Its Replacement](https://www.investopedia.com/terms/p/plaza-accord.asp)

The Plaza Accord was a 1985 agreement among the G-5 nations to depreciate the U.S. dollar relative to the Japanese yen and the German Deutschmark.

[more](https://www.investopedia.com/terms/p/plaza-accord.asp)

[What Is a Commodity Index, Its Functions, Major Examples?](https://www.investopedia.com/terms/c/commodityindices.asp)

A commodity index is an investment vehicle that tracks a basket of commodities to measure their price and investment return performance.

[more](https://www.investopedia.com/terms/c/commodityindices.asp)

[Jobless Claims and the Market: Why They Matter](https://www.investopedia.com/terms/j/jobless-claims.asp)

Jobless claims are a statistic reported weekly by the U.S. Department of Labor that counts people filing to receive unemployment insurance benefits.

[more](https://www.investopedia.com/terms/j/jobless-claims.asp)

Related Articles

[Tradable Commodities: What They Are, How They Work](https://www.investopedia.com/ask/answers/022315/what-are-tradable-commodities.asp) [What Causes Oil Prices to Fluctuate?](https://www.investopedia.com/ask/answers/012715/what-causes-oil-prices-fluctuate.asp) [Currency Fluctuations: How They Affect the Economy](https://www.investopedia.com/articles/forex/080613/effects-currency-fluctuations-economy.asp) [10 Countries With the Most Natural Resources](https://www.investopedia.com/articles/markets-economy/090516/10-countries-most-natural-resources.asp) [Currency Crisis: What They Are, Examples and Effects](https://www.investopedia.com/articles/economics/08/currency-crises.asp) [Manipulation: Definition, Methods, Types, and Example](https://www.investopedia.com/terms/m/manipulation.asp)

Partner Links

[Investopedia Homepage](/)

- [Visit Investopedia's Facebook](https://www.facebook.com/Investopedia/)
- [Visit Investopedia's X](https://twitter.com/investopedia)
- [Visit Investopedia's Instagram](https://www.instagram.com/investopedia/?hl=en)
- [Visit Investopedia's LinkedIn](https://www.linkedin.com/company/investopedia-ulc)
- [Visit Investopedia's Newsletter](/investopedia-newsletter-opt-in-7095821)

[Access TRUSTe's Enterprise Privacy Certification program](//privacy.truste.com/privacy-seal/validation?rid=f8e1238d-6371-460f-8ea0-1b8cad9e9c4b)

- [About Us](/about-us-5093223)
- [Terms of Service](https://www.dotdashmeredith.com/brands-termsofservice)
- [Dictionary](/financial-term-dictionary-4769738)
- [Editorial Policy](/legal-4768893#editorial-policy)
- [Advertise](https://www.dotdashmeredith.com/)
- [News](/news-4427706)
- [Privacy Policy](https://www.dotdashmeredith.com/brands-privacy)
- [Contact Us](https://invcontent.zendesk.com/hc/en-us/requests/new)
- [Careers](https://www.dotdashmeredith.com/careers)
- Your Privacy Choices

- [#](https://www.investopedia.com/terms-beginning-with-num-4769350)
- [A](https://www.investopedia.com/terms-beginning-with-a-4769351)
- [B](https://www.investopedia.com/terms-beginning-with-b-4769352)
- [C](https://www.investopedia.com/terms-beginning-with-c-4769353)
- [D](https://www.investopedia.com/terms-beginning-with-d-4769354)
- [E](https://www.investopedia.com/terms-beginning-with-e-4769355)
- [F](https://www.investopedia.com/terms-beginning-with-f-4769356)
- [G](https://www.investopedia.com/terms-beginning-with-g-4769357)
- [H](https://www.investopedia.com/terms-beginning-with-h-4769358)
- [I](https://www.investopedia.com/terms-beginning-with-i-4769359)
- [J](https://www.investopedia.com/terms-beginning-with-j-4769360)
- [K](https://www.investopedia.com/terms-beginning-with-k-4769361)
- [L](https://www.investopedia.com/terms-beginning-with-l-4769362)
- [M](https://www.investopedia.com/terms-beginning-with-m-4769363)
- [N](https://www.investopedia.com/terms-beginning-with-n-4769364)
- [O](https://www.investopedia.com/terms-beginning-with-o-4769365)
- [P](https://www.investopedia.com/terms-beginning-with-p-4769366)
- [Q](https://www.investopedia.com/terms-beginning-with-q-4769367)
- [R](https://www.investopedia.com/terms-beginning-with-r-4769368)
- [S](https://www.investopedia.com/terms-beginning-with-s-4769369)
- [T](https://www.investopedia.com/terms-beginning-with-t-4769370)
- [U](https://www.investopedia.com/terms-beginning-with-u-4769371)
- [V](https://www.investopedia.com/terms-beginning-with-v-4769372)
- [W](https://www.investopedia.com/terms-beginning-with-w-4769373)
- [X](https://www.investopedia.com/terms-beginning-with-x-4769374)
- [Y](https://www.investopedia.com/terms-beginning-with-y-4769375)
- [Z](https://www.investopedia.com/terms-beginning-with-z-4769376)

Investopedia
is part of the [Dotdash Meredith](https://www.dotdashmeredith.com) publishing family.

By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts.

Cookies SettingsAccept All Cookies