Trade Precious Metals with AIFundBTC

What You Need to Know About Trading Metals

In trading, metals refer to both precious and base metals – assets like gold, silver, platinum, and copper that hold real-world value and play a major role in global industries such as tech, construction, and jewellery.

Precious metals, especially gold and silver, are seen as safe havens during inflation or times of economic uncertainty. Traders can access metal markets through spot trading, futures contracts, and even ETFs – with price movements influenced by global demand, supply dynamics, political events, and broader market conditions.

Trading metals can be a strong way to diversify your strategy. With the right analysis and a solid grasp of global trends, metals offer plenty of opportunity in both the short and long term.

Explore the Most Traded Metals on the Market

1. Gold

   • Gold remains one of the most sought-after precious metals. It’s seen as a safe-haven asset and a trusted store of value, especially during economic turbulence. It’s also widely used in jewellery, electronics, and as a hedge against inflation.

2. Silver

   • Silver has strong industrial demand, particularly in electronics, solar tech, and medical tools. It offers similar safe-haven appeal to gold but at a more accessible price point, making it popular with a wide range of investors.

3. Platinum

   • Platinum is a rare and valuable metal with key uses in jewellery, electronics, and especially in the automotive industry thanks to its role in catalytic converters. Its supply is limited, making price movements especially impactful.

4. Palladium

   • Highly used in vehicle emission control systems, palladium has seen rising demand in recent years. It’s become a favourite among investors looking to benefit from industrial growth and green tech trends.

5. Copper

   • Copper is a core base metal, essential in construction, manufacturing, and electronics. Its price is often considered a health check on the global economy – when copper moves, the world tends to follow.

6. Aluminum

   • Lightweight, corrosion-resistant, and endlessly useful, aluminium is a key material in industries like transportation, packaging, and construction. Its broad use keeps it in constant demand across markets.

7. Nickel

   • Nickel is crucial in making stainless steel and EV batteries. As the electric vehicle sector grows, so does interest in nickel, making it a strong pick for traders watching the energy and tech space.

These metals are actively traded across global exchanges and offer traders the chance to diversify into assets that have both industrial and investment value. Whether you’re after stability or volatility, metals are always in motion.

Why Traders Choose Metals as Part of Their Strategy

A Real-World Gold Trade in Action

Let’s look at a practical example of how a trader uses CFDs to take advantage of market movements. Consider our trader, Sarah.
She’s been closely watching gold due to rising geopolitical tensions in key gold-producing regions. Based on her research and technical analysis, she believes the uncertainty will push gold prices higher over the coming weeks. With that conviction, Sarah decides to act before the market reacts.

Instead of buying physical gold, Sarah chooses to trade a gold CFD (Contract for Difference) through her broker. Gold is currently priced at $1,800 per ounce. Trading a CFD means she can speculate on the price without owning the metal itself — and thanks to leverage, she can open a much larger position with a smaller upfront margin.

Here’s how the trade plays out:

• Position Size: 100 ounces of gold
• Gold Price: $1,800 per ounce
• Total Position Value:  100 × $1,800 = $180,000
• Required Margin: Her broker requires a margin of just 0.5% to open the position.
• Margin Needed:  0.5% × $180,000 = $900

So, with just $900, Sarah controls a $180,000 gold position.

What Could Happen?

Scenario 1: Gold Price Increases

If Sarah’s forecast is right and gold rises by 10%, she profits:

• New Price:  $1,980 per ounce
• Profit Per Ounce:  $180
• Total Profit: 100 × $180 = $18,000

A $900 margin turning into $18,000 profit? That’s the power of leverage.

Scenario 2: Gold Price Drops

But if gold falls by 5%, Sarah takes a hit:

• New Price: $1,710 per ounce
• Loss Per Ounce:  $90
• Total Loss: 100 × $90 = $9,000

In this case, her $900 margin leads to a significant loss.

Key Takeaways from Sarah’s Trade

• Entry Price: $1,800
• Margin Used: $900
• Profit Potential (10% gain): $18,000
• Risk Exposure (5% loss): $9,000

This example shows how CFDs let traders control large positions with small capital. But while the upside is big, the downside is just as real. Smart risk management is everything when trading with leverage.