Commodity Trading for Beginners: Best Commodity Trading Apps of 2024 (2024)

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Commodities are considered alternative investments that are great for portfolio diversification and hedging against inflation. Just like with stocks or bonds, you can invest in commodities and commodity futures through a brokerage. Commodity brokers act as middlemen between investors and the commodity market while offering clients a level of expertise and risk management.

Best Commodity Trading Apps

• TD Ameritrade: Best overall for beginners
• eToro USA: Best for commodity ETFs
• tastytrade: Best for low-cost futures
• Interactive Brokers: Best for global trading
• Tradeworks: Best research strategy database
• NinjaTrader: Best for trading tools
• E*TRADE: Best for margin traders and IRAs
• Goldco: Best for buying gold
• Charles Schwab: Best for education and expert research

Commodity Trading Platforms

The best brokers for buying commodities offer diverse investments, low contract fees, accessible interfaces, and advanced charting features and tools. Experienced investors can trade commodity futures, options, ETFs, and mutual funds through online brokerages.

Only advanced traders with a high-risk tolerance should invest in commodities. However, some brokerages with beginner-friendly educational resources may be suitable for new investors.

The following futures and commodities brokers offer some of the best investment options, account features, educational resources, and fees for futures and commodities brokers. Before jumping in head first, make sure to thoroughly compare the different brokerage offerings and features to make sure you pick the best one for you.

TD Ameritrade

Best Overall

TD Ameritrade is one of the best online brokerages for future trading and low-cost mutual funds. TD Ameritrade has low fees overall, but commissions on futures are slightly higher than other brokers on this list. But a regular DIY TD Ameritrade account has no minimum investment requirement.

TD Ameritrade offers commodity futures for metals, energies, agriculture, currencies, softs, stock indexes, interest rates, cryptos, and micros. You'll pay $2.25 per future contract.

The brokerage offers a range of educational resources about futures investing basics, as well as resources on maximizing capital efficiency, how futures compare with stocks, and much more. Beginner investors can benefit from TD Ameritrade's "Fundamentals of Futures" course, which provides demos, videos, and quizzes on futures trading and related topics.

TD Ameritrade review

eToro

Best for commodity ETFs

eToro USAoffers a range of commodity ETFs for trading, including physically backed funds, equity funds, CFDs, and exchange-traded notes (ETNs). Commodity ETFs are a great way for investors to diversify their investment portfolios with significantly less risk than investing in physical commodities. The downside is that eToro does not offer commodity futures.

With eToro USA you can invest in commodity ETFs such as the United States Gasoline Fund (UGA), iShares Silver Trust (SLV), SPDR S&P Oil & Gas Exploration & Production (XOP), GraniteShares Gold Trust (BAR), PowerShares DB Oil Fund (DBO), Direxion Daily Gold Minor Index (DUST), and Direxion Daily S&P Oil & Gas Exp. (DRIP).

eToro USA review

tastytrade

Best for low-cost futures

tastytrade (previously known as tastyworks) allows investors to trade commodities such as futures, options, futures options, ETFs, and stocks with no account minimum. Available commodities include energy (like coal and crude oil), agriculture (like corn and soybeans), precious metals (like gold and silver), and currencies.

tastytrade commodity futures span multiple asset classes, including futures, micro futures, small futures, small futures options, and futures options. Opening commissions per contract for futures range from $0.25 to $2.50.

Closing commissions per contract range from $0.00 to $1.25. Moreover, you can use tastytrade's Trading Pairs feature to balance out your investment portfolio. For example, you can invest in the gold and silver ratio, energy pairs, or grain pairs.

tastytrade review

Interactive Brokers

Best for global trading

Interactive Brokers offers global commodity futures over 30 market centers around the globe. Commodity assets available for futures trading include agriculture, energy, currencies, metals, and softs. Futures commissions range from $0.25 to $0.85 per contract. There is a $0 ($100 Interactive Advisors automated accounts) minimum to start investing with Interactive Brokers.

With an Interactive Brokers account, you'll get access to multiple features, including futures trading tools like:

• ComboTrader: Investors can choose from various pre-established programs for executing futures trades or create their own proprietary combination order strategies.
• SpreadTrader: This is a command center for managing futures positions. It's integrated with Interactive Brokers' Trader WorkStation (TWS) feature.
• Index Arbitrage Meter: This measurement tool is designed to analyze index arbitrage strategies. It illustrates the spreads between feature contracts and spot prices.

Interactive Brokers review

Tradeworks

Best research strategy database

Tradeworksis an automated trading platform that implements algorithm research strategies and custom automated rules through trading bots. Tradeworks is not a broker itself but rather a tool that can be connected with an existing brokerage account. However, Tradeworkers can only be implemented with MetaTrader 4 brokers like Avatrade, IC Markets, and FP Markets.

Although Tradeworks doesn't offer commodity trading directly, the platform can assist you in designing, testing, running, and analyzing trading strategies. Some of the best features include the Algo editor, the improved backtest tool, and the advanced performance analytic feature for real-time analysis of your trading strategies.

Tradeworks has four account options:

• Incubator plan: For $9 per month, you won't get access to any trading accounts or active robots. But you can still access 10 backtests per day.
• Solo plan: For $49 per month, you can open one trading account and one active robot, plus 30 backtests per day.
• Trio plan: For $99 per month, you can open one trading account, three active robots, and 100 backtests per day.
• Octet plan: For $199 per month, you can open three trading accounts, eight active robots, and unlimited backtests per day.

All plan options are eligible for a 14-day free trial period.

NinjaTrader

Best for trading tools

NinjaTrader is an online futures trading platform with over 100 futures trading tools, like customizable apps and strategies, free simulated trading accounts, live customer support, advanced charting features, drawing tools, automated strategies, and low-cost trades. There's no account minimum needed to open a NinjaTrader account.

With NinjaTrader, you can trade commodity futures like agriculture futures, metal futures, natural gas futures, forex futures, crude oil futures, stock index futures, crypto futures, and interest rate futures. Regular futures commissions start at $0.59 per contract and $0.90 per contract for micro futures.

E*TRADE

Best for margin traders and IRAs

E*TRADE offers more than 60 futures contracting across various markets, including metals, energies, grains, softs, livestock, and currencies. The brokerage also offers futures for interest rates, crypto, and equity indexers. Investors can trade regular futures, micro futures, and E-mini futures. Future commissions cost $1.50 per trade, but additional futures exchange fees and National Futures Association (NFA) fees may apply. Cryptocurrency futures cost $2.50 per contract.

You must have an E*TRADE margin-enabled brokerage account or an eligible IRA to trade futures. You'll get 24/6 access to markets (from Sunday 5 p.m. CT to Friday 4 p.m. CT). Other features include no short sale restrictions, mobile access, formulated trading strategies, a suite of drawing tools, and access to E*TRADE's Futures Research Center.

E*TRADE also offers commodity ETFs that almost exclusively invest in commodity assets like agriculture, energy, or metals. There are no additional trading fees for ETFs.

To open a margin account with E*TRADE, you must have at least $2,000 in your account. IRAs have a $500 minimum to open an account. That means before you can invest in commodity futures or ETFs, you must at least deposit $500 in your account. If you don't want to invest in an IRA, you'll need to open a margin trading account for a much higher minimum.

E*TRADE review

Goldco

Best for buying gold

Goldco is our top pick for the best gold IRA. It allows investors to trade physical gold bullion and gold coins with an IRA, or get physical gold sent directly to them. Goldco also offers silver IRAs, platinum IRAs, and palladium IRAs.

Goldco is one of the industry's most trustworthy gold investing firms, with an A+ from the Better Business Bureau and a history of great customer support services. Another perk is that Goldco charges lower fees on greater asset amounts than some competitors.

Goldco allows you to fund your account with rollovers for 401(k)s, 403(b)s, IRAs, thrift savings plans, and savings accounts. The firm can also convert gold assets into cash for you. On the downside, you'll need at least $25,000 to open an IRA with Goldco, which is higher than with some similar platforms like Augusta Precious Metals or Noble Gold Investments.

Charles Schwab

Best for education and expert research

Charles Schwaboffers commodity regular future trades and micro E-mini futures for energies, financials, metals, softs, livestock, and agriculture. The brokerage allows you to pay the same price for online trades and broker trades. And you'll get 24/7 customer support. You can even use Charles Schwab's team of specialists to review and place your futures trades.

Although contract fees for futures are higher than with similar brokerages ($2.25 per contract), investors will get access to Charles Schwab's vast range of research tools. This includes Schwab's Futures Research Center, daily analysis on the futures market, access to independent analysis from the Hightower Report and Wyckoff Report, as well as daily videos from futures experts.

Charles Schwab review

How to Invest in Commodities

Commodities can be directly traded for goods or cash, but there are other ways to invest in commodities. Instead of dealing with the hassle of owning physical gold or cattle, you can indirectly invest through a brokerage account and trade commodity futures contracts, options, stocks, ETFs, and mutual funds.

With commodity futures, the futures contract holder must buy or sell a commodity on a specific date for a specific price to make a profit. Since futures tend to be volatile investments, individual investors may prefer to invest in options based on a futures contract, as holders aren't obligated to sell on a certain date.

Another option to invest in commodities is through stocks, ETFs, and mutual funds. These assets invest in companies that produce or process commodities. Mutual funds and ETFs are great tools for diversifying your investment portfolio and lowering your risk of exposure.

Alternatives to Commodity Brokers

If you're interested in investing in precious metals, you may want to consider buying physical gold in the form of bullion bars or ingots. Unlike some commodities like livestock or agriculture products, physical gold can be easy to store and won't expire. Plus, gold is largely immune to inflation and is a great hedge against economic struggles and disasters. You can buy gold from banks or gold dealers.

You can also invest in some of the best gold IRAs to further diversify your retirement savings and hedge against inflation. But keep in mind that storage fees, custodial fees, and set-up costs tend to be higher with gold IRAs compared to other IRA plans. For instance, annual fees tend to exceed $100. Another thing to consider is that gold IRAs don't usually award dividends or yield high returns.

If you're new to investing in commodities or need help establishing a financial plan, you can find a financial advisor for expert guidance and advice. It's important to find the best financial advisor you can find.

Commodities vs. Stock Futures

Commodities are physical assets and goods like crops, energy resources, agriculture products, precious metals, or currencies. Commodities can be bought and sold for cash or other goods. On the other hand, stock futures are legal contracts that require the holder to buy or sell a stock or other asset by a specific date for a specific price.

When investing in commodity futures, you are legally obligated to sell or buy a commodity for a specific price on a specific date. You'll make a profit if the spot price of a commodity rises since the seller will still have to sell the asset at the set price. However, commodities are generally volatile assets with high risk.

Commodity Glossary

• Dow Futures Live Stream: The Dow Jones is one of the top stock market indexes, tracking 30 of the most prominent US companies on the stock market. You can use the Dow Futures Live Stream to watch real-time futures trading. You can also access real-time charts, news, futures analysis, and more.
• Commodities: Commodities are tangible, publically traded goods or assets, such as agricultural products, precious metals, energy resources, livestock, meats, and more. You can invest in commodities directly or indirectly through a brokerage.
• Commodity Market: Similar to the stock or bond market, the commodity market is a market that trades raw and primary goods and products. For example, the commodity market can trade soft commodities like wheat, sugar, coffee, or cocoa. Another example is metal commodities, which are mined materials like gold or silver.
• Commodity Future: One of the most popular ways to invest in commodities like agricultural goods or mined raw materials is through futures contracts. Rather than investing directly in a commodity, holders are obligated to buy or sell a commodity at a certain for a set price. The best brokers for buying commodities offer a range of commodity futures across different markets.
• Stock Futures Investing: You can invest in stock futures to hedge against inflation and diversify your investment portfolio. Stock futures are available through brokerages.

Commodity Brokerages that Didn't Make Our List

• TradeStation: You can invest in futures for metals, energies, softs, meats, agriculture, and more with TradeStation. However, the brokerage has a complex fee structure, and future contracts may be pricier compared to other platforms.
• Plus500: Plus500 is a European broker popular for future trading. It offers a range of commission-free indices, commodities, and currencies for trading across multiple markets. But Plus500 is not available in the US, so US investors should look elsewhere.
• Optimus Futures: Optimus is a discount brokerage for forex and futures trading. It offers self-directed, automated, institutional, and professional trading, and you can open an IRA. The brokerage has a large selection of educational resources and support access for users, but there's a $500 minimum to open an account.
• ActivTrades: ActivTrades is a UK-based forex broker that offers forex trading, shares, indices, crypto, ETFs, commodities, and bonds. However, ActivTrades isn't available for US residents.
• Tickmill: You need at least $100 to open a classic account with Tickmill and access multiple trading accounts, educational resources, and trading tools. Tickmill isn't available in the US and has an outdated platform design.

Commodity Trading Tips

Why You Should Trust Us: Our Expert Panel For The Commodity Trading Apps

We interviewed the following investing experts to see what they had to say about commodity trading apps.

• Sandra Cho, RIA, wealth manager, and CEO of Pointwealth Capital Management
• Tessa Campbell, Investment and retirement reporter at Personal Finance Insider

What are the advantages/disadvantages of investing in commodities?

Sandra Cho:

"The advantages are that commodities can serve as a hedge during high inflationary times. This can be helpful if one expects inflation to rise in the near term.

"The disadvantages are that commodities do not offer the same long-term growth that is present in stocks. They also do not offer the same kind of stability that is present in bonds. In general, commodities are better as a short-term option during times of inflation versus a long-term investment where your money is parked for many years."

Tessa Campbell:

"The advantage of investing in commodities is portfolio diversification and hedging against inflation. Investing in tangible goods like crops, energy, precious metals, and currencies can counterbalance traditional investable assets like stocks or bonds. Diversifying your portfolio with traditional investment options and commodities mitigates your portfolio's risk. Moreover, investing in assets like gold or silver can increase portfolio stability.

"The disadvantage of investing in commodities is that they are generally illiquid. Commodities also don't earn dividends or accumulate interest."

Who should invest in commodities?

Sandra Cho:

"Investors who believe that a rise in inflation may be coming should potentially view commodities as a good investment. However, I recommend talking with a financial advisor before making any concrete decisions."

Tessa Campbell:

"Most commodity investments are considered high-risk and are generally best for experienced investors with a high-risk tolerance. However, some commodities (like precious metals) are more stable and don't pose as high of a risk. Precious metals can still be expensive, but more conservative investors may find investing in gold or silver a great way to diversify their investment portfolios."

Is there any advice you'd offer someone who's considering investing in commodities?

Sandra Cho:

"I would advise them to talk with a financial professional. Commodities can be a useful investment if used at the right time. However, many investors do not know when that time is. Talking with a professional will give investors the insight they need when deciding whether or not to invest in an asset class like commodities."

Tessa Campbell:

"If you're going to invest in more volatile commodities, such as agricultural products that depend on nature or other non-predictable elements, do thorough research before investing. You should also consider how you want to invest in commodities — whether that be investing in physical commodities themselves, commodity futures, or commodity stock — and make sure to understand the level of risk involved in investing in these assets."

Methodology: How to Choose a Commodity Broker

We used Personal FinanceInsider's methodology for rating investment platforms when reviewing brokers for commodity trading to find the best platforms for low fees, multiple asset options, futures trading tools, and customer service. We also favored platforms that offered a range of other features and products, such as educational resources and account flexibility. Investment platforms are given a rating between 0 and 5.