Tutorials
Learn commodity futures, the fast way
Eight plain-English lessons from "what is a contract" to reading the COT report — each with an Ask Tara button so you can learn interactively, plus links to CME Group's free courses when you want the authoritative deep-dive.
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Lesson 1
Futures 101 — what a contract actually is
A futures contract is a standardized, exchange-traded agreement to buy or sell a set quantity of something — gold, crude oil, corn — at a price agreed today, for delivery on a future date. You can go long (profit if price rises) or short (profit if it falls) with equal ease, and you post only a small margin deposit rather than the full value — that's what creates leverage. The market exists because producers and consumers hedge price risk, and speculators take the other side hoping for a return.
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Lesson 2
Contract specs & month codes
Every contract has a spec sheet: the contract size (e.g., 1,000 barrels of crude, 100 troy oz of gold), the tick size (the smallest price move and its dollar value), and a trading code — a product symbol plus a month letter and year (GCZ6 = December 2026 gold). The notional value (size × price) tells you the real exposure one contract carries, which is almost always far larger than the margin you post.
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Lesson 3
Margin & leverage — the double-edged sword
You don't pay the full contract value — you post initial margin (a fraction of it) and must keep your account above the maintenance margin. Positions are marked-to-market every day: gains and losses settle to your account daily, and dropping below maintenance triggers a margin call. Leverage magnifies both directions — a 5% move at 10:1 leverage is a 50% swing on your deposit. Respect it.
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Lesson 4
Expiration & the roll
Contracts expire. Unless you want physical delivery (you don't), you close before expiry or 'roll' — exit the front month and re-enter a later one to keep your exposure. The roll isn't free: in contango you effectively sell low and buy high (a drag on returns), while in backwardation you sell high and buy low (a tailwind). That roll yield is a real, often underestimated part of long-term futures returns.
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Lesson 5
The forward curve: contango vs backwardation
Line up a commodity's contracts by expiry and you get its forward curve. Upward-sloping is contango (supply is plentiful, distant delivery costs more); downward-sloping is backwardation (scarcity — buyers pay a premium for prompt delivery). The slope drives roll yield and is one of the most evidence-backed return signals in commodities — which is exactly why it's the top strategy in our research section.
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Lesson 6
Reading the COT report
Every Friday the CFTC publishes the Commitments of Traders — who is net long and net short, split into commercials (producers and users hedging real exposure) and managed money (speculators). When commercial hedgers are unusually net-short, that 'hedging pressure' has historically preceded positive returns. It's a genuine fundamental signal — and you can watch it live on our CFTC page.
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Lesson 7
What moves each commodity
Different commodities answer to different masters. Gold trades on real yields, the dollar and fear; crude oil on inventories, OPEC supply and global demand; natural gas on storage levels and weather (heating/cooling degree days); grains on weather, crop conditions and USDA reports. Knowing the dominant driver for each market is half the battle — and our Data Explorer surfaces those fundamentals directly.
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Lesson 8
Risk management (read this twice)
Leverage cuts both ways, and the uncomfortable truth is that most retail futures traders lose money — almost always because of position sizing, not bad picks. Risk a small, fixed fraction of your account per trade, decide your exit before you enter, and accept that losing streaks are normal. Survival first, returns second. No signal on this platform changes that.
Go deeper with CME Group
CME Group — the exchange where most of these futures trade — offers 60+ free, self-paced courses and pathways. These tutorials are our own; the links point you to CME's official material for the full curriculum.
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Educational content, not investment advice. Trading futures involves substantial risk of loss. CME Group course links are provided for reference; CME Group is not affiliated with RetailVest.