4 Ways to Short Commodities

The last few years haven’t been kind to commodity investors. Most natural resources have been under pressure as supplies continue to grow while demand evaporates. Excess capacity was brought on by many hard asset firms just as the boom was going bust, thanks to the long lead time to start producing from a mine or oil well. Meanwhile, global growth has been anemic at best since the credit crisis and global recession. That’s clipped demand for most commodities and that demand has never really returned to pre-crisis levels. This supply and demand metric has only been more eschewed as China’s growth has recently vanished. China is a leading consumer of almost every commodity on the planet. Meanwhile, the rising dollar has continued to put downward pressure on all matters of hard assets. Needless to say, the overall commodities boom could become a bust. And yet, there might still be money to be made in the commodities sector by going short. Here are four ways to do that.