How to Market tips for making money with commodities

The commodities market has been given a bad name because of the extreme volatility and losses that people have experienced with it. For years people have recommended stocks to be the safer bet, but is this still true? I have been trading commodities for ten years now and have learned plenty of valuable lessons that have made me a lot of money. There is millions to be made trading commodities but you have to understand what to look for. I am going to give six simple but effective tips on how to trade commodities successfully!

Difficulty: Moderately Easy

Things You'll Need:
brokerage account
Find a volatile market that you want to trade. High volatility might be bad with stocks, but it is a very good thing with commodities. The more volatility in the market, the more opportunities there are to make money.
Instead of trading commodity futures, consider trading commodity options. People have a bad taste in their mouth from all the horror stories they have heard about trading futures, and most of the bad stories are probably true. To make this simple, when you trade futures contracts you can lose more money than you put in, which in my opinion is a very risky bet. Trading a commodity options contract is much safer because you can only lose what you put in, therefore you don't have to worry about losing your life savings.
It doesn't take a lot of money to make a lot of money!! Most people think you have to have a lot of money to make money with commodity options, and this is just not true. If you have a couple thousand dollars to trade with, you can make a nice bundle of money.
Don't put all of your eggs in one basket! Once you have found a volatile market to trade don't listen to all the speculators, and put all of your money on what they say. I can't even count how many times I listened to a specialist and lost my money. The beauty of trading in a volatile market is that you don't have to know which way the market is going.
When you fish on both sides of the boat you are more likely to catch a fish! What I mean by this is purchase a call option with the first thousand, which means you make money when the price goes up. The second thousand needs to be spent on a put option, which means you make money when prices go down. This is a very basic concept that many traders use, but is highly effective in a volatile market. This gives you insurance on your investment, and eases the stress about which way you want the market to go. I have personally made over twenty thousand dollars in one trade using this strategy, and investing no more than two thousand dollars.
Take the money and run! Before you start trading decide how much money you want to make and stick to it. Understand that profit is profit no matter how big or small it is. Don't get greedy just because the market has made a big move, because it can turn against you in a second, so take your profit. This is one of the most simple, but yet hardest thing to do when trading. A one thousand dollar profit may not seem like much, but when you do it five to ten times it can be quite substantial.