Trading glossaryReviewed 16 July 2026
Definition
A commodity is a basic good or resource, such as energy, metal, or agricultural output, that can be traded directly or through contracts.
In market context
Commodity exposure may come from a spot transaction, fund, futures contract, or derivative rather than delivery of the physical good. Prices can respond to weather, inventories, geopolitics, transport, currency moves, regulation, and expectations about supply and demand. Product structure matters because financing, leverage, contract expiry, and roll effects can make an investor’s return differ from the change in the quoted spot price.
Source
Use the primary source for fuller regulatory or market context.