Explanations of "Gold" investment-related terms A to Z

CME Group Inc. is an American holding company and the parent of CME, CBOT and Nymex. It is the world's leading and most diverse derivatives marketplace with exchanges that offer the widest range of global benchmark products across all major asset classes, including derivatives based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals and weather, as well as clearing services for exchange traded and over-the-counter products. In the following part of the definition you'll learn more about gold and CME.

Collateral is an asset pledged by a borrower to secure a loan. The lender can seize the collateral in the event of a default of the borrower. An example of collateral is a house bought with a mortgage. The use of collateral lowers the risk associated with the loan. This is why loans secured by collateral typically have lower interest rates than unsecured loans.

The Commodity Exchange Inc. (Comex) is an American commodity exchange where buyers and sellers electronically meet to invest in precious metals.

Money managers is category of Comex traders specified in the disaggregated version of the Commitments of Traders Report (CoT report) published by the Commodity Futures Trading Commission (CFTC), which represents registered commodity trading advisors (CTA), registered commodity pool operators (CPO), and unregistered funds identified by the CFTC that engage in managing and conducting organized futures trading on behalf of clients. As one can see, that group is very similar to non-commercial traders. The only distinction is that non-commercials are divided into money managers and other reportables in the disaggregated version of the CoT report.

Other reportables is a category of Comex traders specified in the disaggregated version of the Commitments of Traders Report (CoT report) published by the Commodity Futures Trading Commission (CFTC), which represents traders that do not fit into any other category. Usually these are larger traders that trade for their own accounts. In the disaggregated version of the CoT report, other reportables and money managers replace non-commercials from the aggregated version.

Producers / Merchants / Processors / Users (hereafter “producers”) is a category of Comex traders specified in the disaggregated version of the Commitments of Traders Report (CoT report) published by Commodity Futures Trading Commission (CFTC), which represents companies and institutions that engage in the production, processing, packing or handling of a physical commodity and use the futures markets to manage or hedge risks associated with those activities. As one can see, this group is very similar to commercial traders. The only distinction is that swap dealers (who were included in commercials before) now have their own category.

Swap Dealers is category of Comex traders specified in the disaggregated version of the Commitments of Traders Report (CoT report) published by the Commodity Futures Trading Commission (CFTC), which represents entities that deal primarily in swaps for a commodity and use the futures markets to manage or hedge the risk associated with those swap transactions.

Gold commercials (hedgers) is a category of traders specified in the Commitments of Traders Report (CoT report) which represents entities involved in the production, processing or merchandising of gold.

Commodity exchange is a place where various commodities and derivative products are traded.

Commodity index provides traders an opportunity get exposed to a basket of commodities, measuring their performance.

Commodity traders arrive at diversification of their market exposure by creating portfolios that potentially reduces risk or provide a hedging platform

Traders use commodity swap to hedge against price fluctuations in commodity prices, commonly energy and agriculture commodities