What is copper?
Copper is one of the most used metals in the world because of its physical characteristics. Thanks to its properties and the fact that it is cheaper than gold or silver, copper is extensively used for electric wiring, plumbing, heating, industrial equipment and roofing. The primary sources of copper are mines and recycled copper products. It is estimated that more than 30 per cent of world production originates from Latin America.
Copper price movement is related to a number of factors such as supply and demand, interest rates, availability of substitute products, and the value of other metals such as aluminium. Economic activity in the US and China also has an impact on copper price because these countries are among the biggest consumers of this metal.
You can trade copper on the London Metal Exchange or Commodities Exchange Division of the New York Mercantile Exchange (COMEX/NYMEX). Depending on the exchange copper can be traded in lot sizes of 25 tonnes. The quoted price in US dollars is per ton. The COMEX defines lots of 25,000 pounds and the spot price refers to US dollar cents per pound.
Copper price movement
The value of copper has seen some notable ups and downs in the last decade with a peak at the beginning of 2011, when it was traded at $4.5 (£3.63). The lowest point was in January 2016 when it hit $1.9 (£1.5) per pound.
The price chart shows that since June 2018 the copper price has been fluctuating within a range of $2.5 (£2) to $3 (£2.4) while it broke the support level of $2.5 at the beginning of March 2020 and its spot price declined to around $2 in the first half of March.
How to invest in copper
There are different options if you plan to invest in copper. One is to purchase the metal in its physical form from credible metal dealers. However, this type of investment creates additional costs, such as storage payments.
Another way to invest is to buy or sell copper mining stocks, but then besides the copper price, your investment can also be affected by company-related factors. Of course, if you have more in-depth knowledge in the way markets function, especially derivative contracts, you have the opportunity to trade futures contracts or options.
However, if you are looking for an easy way to exploit profitable opportunities based on fluctuations in the copper price, you can consider the tokenised commodities offered by Currency.com. Blockchain technology is used to create tokens linked to a real asset such as copper. Traders can earn profits without the need to buy or sell the commodity or relevant contracts directly.
Another reason why traders may prefer tokenised copper is that Currency.com enables the purchase of tokenised assets with crypto or fiat. Hence there is no need for you to go through the process of exchanging your cryptocurrencies for money. One more feature is leverage of 1:50 when you trade tokenised copper.
Based on the generous leverage traders can open positions with a 2 per cent margin, meaning that they don't need to have substantial capital for larger positions. For instance, a position worth $20,000 (£16,000) would require that you have available capital of 2 per cent or $400 (£320). So you can make higher profits even with lower capital. Copper trading can be highly profitable as long as you have the right strategy.
Tokenised copper trading guide
Copper trading using tokenised assets through Currency.com leveraged trading platform is quite easy since it can be done using cryptocurrency. The steps required for you to trade tokenised commodities are:
- Step 1: Open an account on Currency.com. Currency.com ensures a high level of security using two-factor authentication security (2FA);
- Step 2: You can deposit Bitcoin or Ether or you can fund the account with fiat money;
- Step 3: Calculate the value of your positions based on the available capital and the Currency.com margin. Don’t forget that it is only 2 per cent for this commodity.
- Step 4: Based on your analysis you will determine the position (buy or sell) you want to take with tokenised copper;
- Step 5: The buy and sell orders are initially matched between the platform participants. Afterwards Currency.com matches the free orders through Capital.com, LMAX Digital or Binance, Bitstamp, Kraken, NASDAQ, NYSE and Gain Capital.
- Step 6: You can choose to close your positions in accordance with your trading strategy and enjoy the profits.
Why trade tokenised Copper with Currency.com
Copper trading at Currency.com tokenised assets exchange has a number of advantages. Tokenised assets are underpinned by robust and immutable blockchain technology. Opening a trade will give you a token that tracks and moves according to the underlying instrument's price.
- One-stop crypto trading platform
Trade tokenised Copper with Bitcoin or Ethereum. Benefit from the commodity's price movements without turning your crypto assets into fiat.
Trade tokenised copper with a tight market spread; benefit from maker rebates and competitive taker fees.
Experienced traders can trade the world's top markets, like copper, with up to 1:100 leverage.
- Effective risk management
Manage your risks and secure your profits with stop loss and take profit orders. Save your assets with negative balance protection.
We have a scalable and low latency order management system, which can execute 50 million trades per second.
Currency.com operates under new Belarusian regulation with best-in-class AML and KYC laws. Regulatory details and fees are upfront.