What is spot metal trading?
The spot price, as opposed to a futures contract, of a precious metal like Gold (XAU) or Silver (XAG) is the cash price of that metal in the market at the current point in time. With FXTM, precious metal trading is the act of exchanging Gold or Silver spot prices for a major currency. An example of this is the pair XAGEUR (trades Silver against the Euro), or XAUGBP (Gold against the British Pound).
Spot metal traders use both long- and short-term price charts to monitor Gold or Silver’s price movements, and then place a trade depending on which direction they believe the price may go next. Depending on the market’s current state of volatility, investors might choose to hold either a long- or short-term position according to their trading strategy.
One of the most appealing aspects of trading precious metals’ spot prices is that gold and silver— unlike currencies — are very rarely affected by political and economic events. These assets are typically seen as a hedge against inflation, meaning that regardless of the current state of the financial market, the opportunities to trade metals are potentially plentiful.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.