Raw materials binary options: Trading wheat with digital options (part one)

raw-materials-trading-wheat-binary-optionsThe Binaryoptionsinvesting.net team provides regular overviews of the various raw materials traded on binary options brokers’ financial platforms. Like petroleum, gas, copper and cotton, wheat can prove to be an interesting asset to trade with binary options. This article is the first in a series dedicated to wheat and the ways to trade this agricultural asset.

How is wheat traded? Wheat is like other agricultural raw materials traded on markets like the Chicago Board of Trade (CBOT.) When you speculate on wheat, the unit of measurement is never the gram or kilogram but the bushel. It is a value of exchange specific to the cereal market, which is worth 27.21 kilos of wheat. So the pricing isn’t communicated in dollars but in American cents. For example, a price of 600 equals $6 per bushel.

On the markets, lots are traded in increments of 5000 bushels. There is always another way to speculate on less significant volumes of wheat via an intermediary. The solution is to use certificates indexed as underlying assets.

You can find the part two, which will explain the advantages of trading a raw material like wheat, as well as our suggestions. Use our broker comparison tool, make a deposit and try trading binary options in wheat now!

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