Size of The Market
The trading of commodities consists of direct physical trading and derivatives trading. Exchange traded commodities have seen an upturn in the volume of trading since the start of the decade. This was largely a result of the growing attraction of commodities as an asset class and a proliferation of investment options which has made it easier to access this market.
The global volume of commodities contracts traded on exchanges increased by a fifth in 2010, and a half since 2008, to around 2.5 billion million contracts. During the three years up to the end of 2010, global physical exports of commodities fell by 2%, while the outstanding value of OTC commodities derivatives declined by two-thirds as investors reduced risk following a five-fold increase in value outstanding in the previous three years. Trading on exchanges in China and India has gained in importance in recent years due to their emergence as significant commodities consumers and producers. China accounted for more than 60% of exchange-traded commodities in 2009, up on its 40% share in the previous year.
Commodity assets under management more than doubled between 2008 and 2010 to nearly $380bn. Inflows into the sector totalled over $60bn in 2010, the second highest year on record, down from the record $72bn allocated to commodities funds in the previous year. The bulk of funds went into precious metals and energy products. The growth in prices of many commodities in 2010 contributed to the increase in the value of commodities funds under management.
Read more about this topic: Commodity Market
Famous quotes containing the words size of, size and/or market:
“To believe her limited in range because she was harmonious in method is as sensible as to imagine that when the Atlantic Ocean is as smooth as a mill-pond it shrinks to the size of a mill-pond.”
—Rebecca West (1892–1983)
“Our brains are no longer conditioned for reverence and awe. We cannot imagine a Second Coming that would not be cut down to size by the televised evening news, or a Last Judgment not subject to pages of holier-than-Thou second- guessing in The New York Review of Books.”
—John Updike (b. 1932)
“A sentimentalist, my dear Darlington, is a man who sees an absurd value in everything, and doesn’t know the market price of any single thing.”
—Oscar Wilde (1854–1900)