Why You Should Be Long Gold, Silver and Oil Over the Weekends

There is a saying on Wall Street that you do not want to hold stocks over the weekend, especially if there is uncertainty in the air. However, when it comes to commodities such as gold, silver and oil, uncertainty can equal profits. That is why it is a good idea to go long on these "Crisis Commodities" during an uncertain weekend.

Which Commodity is Best?

You might be wondering which commodity offers you the best chance for a profit. Well, there are many factors that can play into that decision. There are seasonality factors. For instance, oil is powerful during the spring months of March and April while Gold is powerful in September. On the other hand, Silver has not real seasonality. Your best bet it to investin the Powershares DB Commodities Index ETF (DBC). This index has oil, gold and silver - as well as many other commodities. You can find a complete list of commodities in the DBC ETF on the Powershares link here. This gives you a great basket of commodities which are likely to gain during a crisis.

A Great hedging Strategy

One of the best ways to hedge yourself over the weekend is to go long the DBC commodities ETF while going short the S&P 500 with the SH (Inverse S&P 500) ETF. In the event of a crisis, the general stock market is likely to go down while commodities should go up. If you want to use leverage, then open an account on the NADEX. You can go long a spread in Oil, Gold and Silver, while going short on the S&P 500 (NOTE: The NADEX uses the term U.S. 500). The NADEX is the only place where you can use low-price derivatives for short term speculation. The price of there binary and spread options vary anywhere from a few dollars to a few hundred dollars.

Summary

Uncertainty can make people flee the markets over the weekend. However, if you go long commodities, you stand to profit if a crisis breaks out when the markets are closed. If you want to hedge your bets, then go long commodities while shorting the general stock market.