Exchange Traded Commodity

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Investment - securities - commodities.


Exchange Traded Commodities are tradeable securities backed by a direct investment by the issuer in commodities or commodities derivative contracts.

Accordingly, the price of the ETC is closely linked to the price of the underlying commodity - or commodity index.

An advantage of ETCs for investors - particularly retail investors - is that they give exposure to the market price of a commodity - or a commodity index - without the need for the administration and cost of managing derivative or other contracts.

These tasks are undertaken by the issuer.

Source: London Stock Exchange Group

See also