The Next Evolution of Metals Trading
Jun 10, 2020
By: Frank Kaberna
Metals markets like gold, silver, and platinum have long represented an asset class distinct from stocks and bonds, and they afford all market participants a distinctive opportunity. Investors can add diversification to their portfolios. Risk managers can add exposure to a flight-to-quality asset in gold. And traders can add new products to their watchlist that may exhibit volatility regardless of where the stock market is.
This source of opportunity, however, is often obscured by trading products that don’t show an accurate picture of metals. Impure exposure from mining stocks like Newmont (NEM) and the ETFs that hold them can create much different results for traders looking to trade the hard commodities themselves.
The Small Exchange aims to meet the need for pure exposure with its Small Precious Metals futures contract (/SPRE). It’s not the first product to track gold, silver, or platinum, but /SPRE has a new take on metals. It combines all three precious metals relative to their production, consumption, and trade volume. This methodology creates a holistic view of the entire asset class, and it ceases the need to choose which market best fits a trader’s idea on metals.
Trading Small Precious Metals is a constant topic of conversation on Small Stakes as the hosts show how /SPRE can fit into accounts of any size to serve different purposes. The show also taps into trading relationships between the new product and its older counterparts in GLD, /GC, and /SI. Small Precious Metals offers a great complement or replacement for large metals futures and ETFs.
Save Every Time You Trade the Smalls
The Small Exchange has also created a limited number of subscriptions for a one-time payment of $100 that give traders a lifetime of reduced exchange and market data fees when trading the Smalls.
For more information on the Small Exchange’s products and subscription service, visit www.thesmallexchange.com. And be sure to check out my new show on tastytrade, Small Stakes, where Pete Mulmat and I will show viewers how to navigate Small Exchange products every Monday-Friday and always on demand.
If you’d like to find out where to trade the Smalls products check out the list of brokers that offer their products, or tastytrade’s preferred broker tastyworks.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.
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