Best Commodity Brokers in 2025

Which raw materials can be traded online?

Commodities trading is a key pillar in financial markets, offering investors exposure to the raw materials that drive global economies. Commodities are basic goods used in commerce, such as metals, energy sources, and agricultural products. Their prices are shaped by the balance between global supply and demand, weather, geopolitics, technological advancements, and macroeconomic trends. For example, oil prices can swing widely following geopolitical tensions, while crop prices react to weather patterns and harvest data.

Commodities play a crucial role in diversifying a traditional investment portfolio because their price movements often differ from stocks and bonds. Online trading platforms provide access to commodities through different instruments. The most common are CFD (Contracts for Difference), which let you speculate on price changes without actually owning the physical commodity; futures contracts, which are standardized agreements to buy or sell a specific amount of a commodity at a set date and price; and commodity ETFs (Exchange Traded Funds), which track the price of a basket of commodities or a single commodity.

Below, you’ll find a summary of key commodities, including their main characteristics, investment profile, and how to access them.

Investing in Gold

Gold is well-known for its role as a “safe-haven” asset in times of economic or geopolitical stress. Its price tends to remain stable or even increase when stock markets drop, which makes it a popular choice for diversification. Gold can be traded either physically, through online brokers offering ETFs or CFDs, or via futures contracts. Due to its relatively lower volatility compared to other commodities, it suits investors seeking capital preservation and portfolio stability.

Investing in Brent Crude Oil

Brent oil is the world’s reference price for crude oil and symbolizes the heartbeat of the energy markets. Oil trading is highly speculative, driven by supply/demand dynamics, geopolitical events, OPEC decisions, and economic cycles. The commodity can experience rapid and significant price swings. It’s mainly suited for investors who can monitor markets actively and manage risk in volatile environments, using instruments like CFDs or oil ETFs.

Investing in Natural Gas

Natural gas is a highly volatile energy commodity, with prices that react strongly to seasonal weather, storage levels, and geopolitical developments. It is well suited for experienced traders focused on short-term opportunities, given its price can swing sharply in a matter of days. Instruments such as CFDs and futures enable active speculation, though they require strict risk management.

Investing in Aluminium

Aluminium is a versatile industrial metal, linked closely to the construction and automotive sectors. Its price is sensitive to global economic growth, changes in supply from major producers, and shifting trade policies. Investing in aluminium may appeal to investors looking to diversify outside of precious metals, via CFDs or futures, especially during periods of economic recovery.

Investing in Grains (Wheat, Maize, Soybeans)

Grains like wheat, corn (maize), and soybeans are foundational to global food supply. Their prices are driven by weather conditions, harvest quality, global demand (especially from large importers like China), and trade policies. Grains can show significant price fluctuations at harvest time or during weather-related disruptions. They are suitable for investors wanting exposure to agriculture, typically through CFDs, futures, or agriculture ETFs, while keeping in mind their seasonal volatility.

How to invest in commodities?

Investing in commodities offers several approaches, depending on your goals and investor profile. Whether you’re looking for active short-term speculation or a more stable, long-term diversification, commodities represent a class of physical assets accessible through various financial instruments. This guide outlines the main methods available to investors, so you can understand the options and choose the one best suited to your needs in the Philippines.

Investing via CFDs (Contracts for Difference)

CFDs are derivative instruments that allow you to speculate on price movements of commodities without owning the underlying asset. With CFDs, you can enter trading positions by depositing a margin (a fraction of the contract value), giving you leverage to amplify potential gains—or losses. This approach is frequently used for short-term, active trading and offers flexibility for both rising and falling markets. However, leverage also introduces high risk, and a wrong price movement can lead to losses exceeding your initial investment.

Example of CFD on Oil

Suppose Brent crude oil is trading at $80 per barrel. You believe prices will rise, so you open a CFD position with a broker for 100 barrels, with 10% margin: - Margin required: $800 (10% of $8,000) - If the price rises to $82, you gain ($2 profit x 100) = $200 - If the price drops to $78, you lose ($2 loss x 100) = $200

Investing via Futures Contracts

Futures contracts are standardized agreements to buy or sell a specific quantity of a commodity at a predetermined price and date in the future. Commonly traded on exchanges, futures allow both hedgers (such as producers and consumers) and speculators to participate. Futures are popular for actively managing risk or speculating on price trends, but they require a careful approach due to contract specifications, margin requirements, and expiration dates.

Example of Wheat Futures Contract

Suppose you buy a futures contract for 50 metric tons of wheat at $250 per ton, delivery in three months. If the market price rises to $270 per ton at contract maturity, your gain is ($20 x 50) = $1,000. If the price falls to $240 per ton, your loss is ($10 x 50) = $500.

Investing via ETFs (Exchange Traded Funds)

ETFs are investment funds traded on stock exchanges, offering indirect exposure to commodities or a diversified basket of them. Commodity ETFs track the price of a single commodity, like gold, or a group, such as energy or agricultural products. This method provides diversification, liquidity, and ease of trading—ideal for long-term investors seeking exposure without dealing with the logistics of physical delivery or futures management.

Example of Gold ETF Investment

You buy 100 shares of a gold ETF at PHP 2,500 per share. If the gold price increases and the ETF value rises to PHP 2,650 per share, your investment grows by PHP 15,000 (PHP 150 per share x 100 shares).

Investing in Commodity-Related Stocks

Another indirect way to gain commodity exposure is by buying shares in companies involved in extraction, production, or processing of commodities. The performance of these stocks is partly linked to commodity prices, but also influenced by company-specific factors and broader market trends. This method adds an extra layer of diversification, but with risks and returns not solely tied to commodity prices.

Example of Commodity Stock Investment

You purchase 500 shares of a mining company at PHP 20 per share (total PHP 10,000). If the price of gold rises, the miner’s profits may increase, boosting the share price to PHP 25. Your investment becomes PHP 12,500—a PHP 2,500 gain.

Investing in Physical Commodities

The traditional method is to buy and hold the physical commodity—mainly precious metals like gold, silver, or platinum—either in the form of bars, coins, or jewelry. This method is valued for its security: you own the asset directly, with no counterparty risk. However, issues such as secure storage, insurance, and reselling logistics can limit practicality, especially for larger investments or perishable goods.

Example of Physical Gold Investment

You buy a 50-gram gold bar at PHP 175,000 (calculated at PHP 3,500/gram). If the spot market price rises to PHP 3,800/gram, your bar’s value increases to PHP 190,000—a PHP 15,000 gain if you sell.

Each of these methods comes with specific features, advantages, and risks. By understanding how each instrument works, investors in the Philippines can access global commodity markets with a strategy aligned to their investment goals and capabilities.

Which raw material according to your investor profile?

Not all commodities behave in the same way—some are stable safe havens, while others can fluctuate sharply due to economic data or geopolitics. Your experience, appetite for risk, and investment goals should guide your choice of assets. Here’s how you can classify major commodities by investor profile to choose opportunities in line with your skills and risk tolerance.

🟢 Beginner: stable and predictable commodities

For new investors, it's essential to focus on assets that are less volatile and easier to understand. Here are the main features of gold and aluminium:

• Gold
• Known for its long-term stability and role as a “store of value.”
• Less impacted by short-term economic shocks or political events.
• Used mainly for capital preservation and diversification.
• Aluminium
• Volatility is typically low to moderate.
• Widely used in industries (transport, packaging), leading to steady demand.
• Prices are less exposed to sudden global events than energy or agricultural commodities.

Recommended strategies:

• Use ETFs (Exchange Traded Funds) to gain exposure without taking on delivery or leverage risks.
• Consider CFDs (Contracts for Difference) with low leverage.
• Avoid day trading or highly leveraged products; instead, invest with a medium- to long-term horizon.

🟡 Intermediate: more dynamic assets, exposed to current events

Intermediate investors looking for more dynamism can consider assets influenced by world events and economic data. Oil and grains fit this profile:

• Oil
• Sensitive to geopolitical tensions, supply cuts, and global growth.
• Potential for larger price swings and higher returns but with greater risk.
• Grains (Wheat, Corn, Soybean)
• Impacted by weather conditions, export policies, and global demand.
• Prices can move on seasonal trends and policy announcements.

Recommended strategies:

• Keep up to date with economic news and factors impacting global supply/demand.
• Use swing trading strategies via CFDs or ETFs, seeking medium-term opportunities.
• Set stop-loss orders to limit losses from sudden market reversals.
• Diversify across different commodities to reduce overall risk.

🔴 Expert: highly volatile assets, sensitive to external data

Expert investors with advanced skills and higher risk tolerance can focus on the most volatile commodities. These markets often require speed, discipline, and professional-grade tools.

• Natural Gas
• Highly volatile, driven by weather, inventory reports, and energy transitions.
• Prices can change sharply within hours due to shifting demand and supply.
• Oil (day trading)
• Intra-day price moves can be dramatic; requires tracking real-time data.
• Influenced by OPEC announcements, inventory data, and geopolitical developments.
• Grains (short-term trading)
• Extreme price sensitivity to climate forecasts, export bans, or crop reports.
• Often affected by news during specific agricultural seasons.

Recommended strategies:

• Use advanced charting tools and technical indicators to spot short-term trends.
• Apply scalping or short-term trading methods to benefit from rapid price changes.
• Manage leverage carefully; use hedging techniques to control downside risk.
• Maintain disciplined risk management, as losses can be rapid and large in scale.

By selecting commodities that match your skill level and investment approach, you’re better positioned to manage risk and pursue consistent returns.

How to choose a broker to trade commodities?

Choosing the right broker is a key step to trade commodities safely and effectively. The broker you select impacts your access to markets, security of your funds, fees, trading tools, and overall user experience. For investors in the Philippines, understanding what makes a broker trustworthy and suitable for commodity trading is crucial to protect your investments and maximize your potential returns.

By analyzing each of these criteria, you can choose a commodity broker that fits your trading needs and provides a secure, reliable environment for your investments.

Why invest in commodities?

Is it relevant to include commodities in an investment portfolio? For many investors, traditional choices like stocks and bonds are the cornerstone of a balanced strategy. Yet, commodities—be they agricultural products, energy resources, or metals—deserve serious consideration for several strategic reasons. Their unique characteristics can add valuable balance to your holdings, provided you understand their specific roles and risks.

Commodities stand out for their low or even negative correlation with conventional assets like stocks and bonds. This means their market movements often respond to distinct factors—such as weather patterns, global supply and demand shifts, or geopolitical events—rather than company performance or interest rates. By incorporating commodities, investors can reduce the overall volatility of their portfolio. In essence, when other assets are under pressure, commodities may move independently, helping smooth out returns over time.

Inflation is a persistent concern for investors aiming to preserve purchasing power. Commodities, particularly agricultural goods and energy products, have historically shown a tendency to rise in price during inflationary periods. As the cost of living increases, so does the price of essential raw materials. This makes commodities a potential “hedge” against inflation: they can help cushion the portfolio against the eroding effects of rising prices, especially in environments where stocks and bonds may struggle.

Among commodities, precious metals—including gold and silver—often play a special role. These assets are renowned as “safe havens,” attracting investors during periods of financial turbulence, geopolitical uncertainty, or economic downturns. While not immune to price swings, precious metals tend to maintain their value better than riskier assets when confidence in markets falters. Their inclusion can therefore offer a buffer—a form of insurance—when other portfolio components encounter difficulties.

Finally, certain commodities present tactical opportunities for more active investors. For example, the oil market is highly sensitive to geopolitical developments and shifts in global demand, which can lead to pronounced price movements. Identifying such trends allows investors to potentially achieve gains over the short or medium term. However, this requires careful analysis and timing, as commodities markets can be volatile and influenced by unpredictable factors.

Key takeaway

Commodities are not a guaranteed way to boost portfolio performance, and they carry their own risks. However, when thoughtfully included, they contribute to diversification, offer potential protection against inflation, add a stabilizing element through precious metals, and create space for tactical opportunities. For investors in PH seeking a robust and resilient portfolio, understanding the place of commodities is an important step towards building long-term financial stability.

How much does commodity trading cost?

Trading commodities, such as gold, oil, or agricultural products, offers many opportunities, but comes with specific costs that every trader should understand before starting. The main fees linked to commodities trading are the spread (the difference between buy and sell price), transaction commissions, overnight financing fees (“swaps”), inactivity fees and withdrawal charges. Knowing the details and real impact of these fees is key to maximizing your earnings and avoiding unpleasant surprises. Even small costs can accumulate over time and significantly impact your final profit, especially if you trade regularly or maintain positions for several days.

1. Spread

The spread is the difference between the price you can buy (ask) and sell (bid) a commodity on your trading platform. It is usually measured in points, cents, or dollars, depending on the commodity. Spreads compensate the broker for providing market access, and they affect both the entry and the exit price, so you “pay” the spread twice on a round-trip trade.

Example of spread

Suppose you want to trade 10 ounces of gold. The buy (ask) price is $2,000, and the sell (bid) price is $1,998. The spread is $2 per ounce. When you buy and immediately sell, this $2 per ounce is your effective cost per trade:

10 ounces x $2 = $20 spread cost

2. Transaction commission

Some brokers charge a fixed or percentage fee for each trade you execute (“per transaction”). This cost is charged separately from the spread and applies whether you win or lose on your trade. Not all brokers apply a commission, and fees can differ depending on the product or platform.

Example of transaction commission

You buy and later sell one lot of oil. The broker charges a fixed $5 commission per trade, so round-trip (open and close), your commission totals $10 for the trade, regardless of your trade size or outcome.

3. Financing fee (swap rate)

If you hold a leveraged or margin position overnight, your broker applies a “swap” or overnight financing fee. This reflects the cost of borrowing money to maintain your position. Rates can be positive or negative depending on the commodity and market conditions. This fee is usually charged daily after the trading session closes.

Example of financing fee (swap)

You hold a position in a silver contract for 3 nights. The swap rate charged by your broker is $2 per night. The total financing cost for holding this position overnight is:

3 nights x $2 = $6 swap fee

4. Inactivity fee

If you do not place any trades or log in for a fixed number of months, some brokers charge an inactivity fee. This fee usually applies monthly until you reactivate your account.

Example of inactivity fee

Your account shows no trading activity for four consecutive months. The broker charges a ₱500 inactivity fee per month. After four months of inactivity, the total fee deducted is:

4 months x ₱500 = ₱2,000 total inactivity fees

5. Withdrawal fee

When you want to transfer money from your trading account to your bank or e-wallet, platforms often charge a withdrawal fee. This can be a flat rate or a percentage of the amount. The fee varies depending on your withdrawal method and the broker’s policy.

Example of withdrawal fee

After closing your trades, you withdraw ₱50,000 to your bank account. The broker charges a ₱200 flat withdrawal fee. The amount you actually receive is:

₱50,000 - ₱200 = ₱49,800

Understanding, calculating, and comparing these fees before trading can help you make more informed decisions and optimize your potential returns.

Live commodity prices

What is the taxation on income from commodities in PH?

The taxation of income from commodities in the Philippines (PH) depends on both the type of financial instrument used—such as derivatives, funds, shares, or physical metals—and the local fiscal rules in place. In general, such income is treated as capital income and falls under specific regimes depending on the product category. Below is an overview of the main tax rules applicable to different types of commodity investments for taxpayers resident in PH.

CFDs (Contracts for Difference) and commodity futures are generally considered financial instruments. In PH, gains realized from trading these derivatives are treated as capital gains and subject to a final tax if considered as passive investment income, typically at a rate of 15%. However, if trading is frequent or constitutes a business activity, gains may be subject to regular graduated income tax rates. Losses on such instruments may be deductible, subject to limitations, especially if the taxpayer is classified as engaged in business.

Commodity ETFs, whether focused on gold, oil, or other raw materials, are taxed mainly based on their legal structure and listing. For PH-listed ETFs, gains from sales are subject to the stock transaction tax and, if held long-term, to final capital gains tax (usually at 15%). Dividends distributed by ETFs are subject to a final withholding tax, commonly at 10%. Investments in foreign ETFs may entail additional considerations, such as potential double taxation, but tax treaties may provide relief.

Shares in mining or oil companies traded on the Philippine Stock Exchange are usually taxed under the preferential regime for listed securities. Sale of shares is subject to the 0.6% stock transaction tax (on gross selling price) and long-term capital gains (15%) if applicable. Cash dividends are taxed via a 10% final withholding tax for resident individuals. For nonresident investors or foreign shares, specific rules may apply, including potential benefits under tax treaties.

Physical precious metals, such as bullion gold or silver, are not directly subject to capital gains tax upon sale by individuals. Instead, acquisition may be subject to Value-Added Tax (12% standard rate) or a percentage tax if sold by dealers. The sale by private individuals is typically VAT-exempt, but regular reselling activity could classify as a business, leading to further tax obligations. Classification as "jewellery" or "collectors’ items" can impact tax treatment, and reporting requirements may apply for large transactions.

Each investment category has specific tax rules in PH; careful documentation and consideration of the legal nature of the asset and transaction frequency is essential to determine the proper tax regime. Local tax developments, reporting requirements, and changes to capital gains or transaction taxes should be checked regularly as the fiscal landscape evolves. For individual cases, professional advice based on the latest PH tax law is recommended.

Raw materials: understanding the Contango and Backwardation effect

Understanding how commodity prices move over time is key for any investor considering exposures to these markets. One fundamental concept is the "forward curve," which compares the current spot price (the price for immediate delivery) with prices for future deliveries (futures contracts). The shape of this curve reveals whether future prices are higher or lower than today's spot price—a signal that directly influences investment decisions. Specifically, two typical shapes dominate: contango and backwardation. Recognizing these can help investors read the market, anticipate costs, and adjust strategies accordingly.

Contango: A Future More Expensive Than Today

Contango describes a market condition where futures prices are higher than the current spot price. In simple terms, buying a commodity for delivery in the future costs more than buying it now. This situation is especially common in commodities that can be stored—like oil, metals, or grains.

The main reasons for contango are:

• Storage costs: Holding a commodity until a future date involves paying for storage facilities.
• Financing costs: Tying up capital in stored goods has a financial cost.
• Insurance and other risks: There may be costs to insure stored commodities against damage or theft.

When these costs are significant, future contracts become more expensive, leading to contango.

Example of Contango

Imagine oil markets during a time of excess supply. If there is more oil than immediate demand, companies fill up tanks and wait for better prices. But storage is not free. So, the price for oil delivered in six months includes today’s spot price plus storage and financing, causing futures prices to be higher than spot. This pattern, seen during oil gluts, is classic contango.

Backwardation: When Urgency Drives Prices

Backwardation is the opposite scenario: futures prices are lower than the current spot price. Here, buying commodities for immediate delivery is more expensive than locking in future delivery. This typically occurs when there is a supply shortage or urgent demand.

Causes of backwardation include:

• Supply disruption: Events like poor harvests or geopolitical crises limit supply.
• High immediate demand: Industries need raw materials right away, pushing up spot prices.
• Inventory shortages: With little stock available, buyers are willing to pay more today than wait.

Backwardation signals that the market rewards immediate delivery, reflecting urgency or scarcity.

Example of Backwardation

Consider wheat during the early months of the Ukraine war. Supply routes were interrupted, reducing global wheat availability. Buyers competed to secure shipments promptly, sending spot prices surging above futures contracts. Futures for later delivery were cheaper, reflecting hopes that supply chains would normalize. This scenario is typical backwardation.

Why Does This Matter to Investors?

For investors using products like ETFs, ETCs, or funds based on commodity futures, the curve matters a lot. These products often don’t hold the physical commodity—they invest via rolling futures contracts (selling the near-term contract before expiry and buying the next one). In a contango market, each roll usually means selling cheaper and buying slightly more expensive, steadily eroding returns—a phenomenon known as "roll yield." In backwardation, the opposite is true: rolling from a high spot price to a lower future price can boost returns. So, knowing whether the market is in contango or backwardation helps anticipate potential gains or losses unrelated to the commodity’s spot price.

In summary

Analyzing the price curve—whether contango or backwardation—gives investors crucial insights: it reveals how the market views future supply and demand, signals potential storage or scarcity issues, and affects the performance of investment products based on futures. Keeping an eye on this curve allows better anticipation of market costs or opportunities, and helps shape sound investment strategies.

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.