Many economists and market analysts predict that commodities will have mixed performance results in 2012. But the general consensus as in this article is that commodities will still fare better than most asset investments. Precious metals such as gold and silver are also expected to gain ground in 2012, according to the report.
Factors having an impact on the 2012 commodity market include the continuing European debt crisis and the U.S. deficit and recession worries. But the report goes on to state that several banks in China and Europe have moved to lower interest rates to encourage business and that usually has a positive impact on commodity futures.
Gold EFTs (exchange traded funds) are expected to do well in 2012, with 2011 being the fourth year in a row that gold has shown a 20% yearly increase in value.
Silver is also expected to do fairly well, as predicted in the report. However, if European and U.S. industry demand for silver as used in the manufacturing of smart phones and other electronics decreases due to economic factors, silver could lose some ground. This could be good news for long term investors though because the price may be right to buy silver futures.
Oil futures are also predicted to be a popular commodity investment for 2012. No record gains are expected, but low to moderate price increases are what most investors see for 2012.
The above mentioned report also noted an interesting fact in that from three years of data, approximately 20% of capital market traders and investors have added some commodities to their portfolio. Of that 20%, there are 7% who switched totally from equities to commodities.
All investments carry risk, but with a good commodity trading advisor and your own research, investing in commodities in 2012 has the potential for profit.
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