How To Invest During Risky Times
August 24 - Jitan Solanki
Discover the best markets and strategies to invest in during risky times.
Company: Although Glencore would be a fantastic name for a single malt whisky, it’s actually a commodities giant with a global presence. This Anglo-Swiss company deals in commodities like coal, copper and silver. It’s also vertically integrated, which is a fancy way of saying it owns every link in the supply chain. So its business is not only in mining these commodities, but it also processes and trades them. In 2013, it bought over mining company Xstrata for $29.5 billion.
The Boss: Boy, this deserves an article of its own. Marc Rich, the company’s founder, was America’s most wanted white-collar criminal until Bill Clinton controversially pardoned him on his last day as president.
These days, the firm is run by Rich’s protege, Ivan Glasenberg, who became a billionaire when Glencore went public in 2011. Not much is known about the secretive CEO who seems to hate giving interviews. But in 2015, he was in the limelight for Glencore’s turnaround plan, after it was crushed by plunging commodity prices.
Main Moneymakers: “We dig dig dig dig dig, heigh-ho!” In real life, the seven dwarves would be working for Glencore as it controls 150 mines all over the world. But a huge chunk of its revenue is not made through pure mining but from trading. In fact, it’s the biggest commodities trader in the world.
Competition: Other mining giants like BHP Billiton, Anglo American and Rio Tinto. Glencore attempted to acquire Rio in 2014, but the offer was declined. Now, Rio Tinto is worth four times more than Glencore.
Revenue: $ 152.9 billion (2016)
Red Flags: It’s got the same problem your online shopping-addicted partner has: debt. To be exact, around $30 billion in 2015.
Glencore’s profits depend a lot on commodity prices. And indirectly on China, which currently gobbles up nearly half of the world’s commodities. If there are any changes that affect its insatiable appetite (like policy), then that could hammer commodity prices.
Fun Fact: Putting money over politics (and ethics), the company has been linked to a string of controversies. From doing business with an apartheid-era South Africa despite a UN trade ban to colluding with Saddam Hussein in Iraq, Glencore hasn’t met a shady deal it doesn’t like.
You can trade Glencore – as well as commodities like gold, silver and platinum – with BUX!
August 24 - Jitan Solanki
Discover the best markets and strategies to invest in during risky times.
June 21 - Jitan Solanki
Discover all you need to know about cryptocurrency exchanges.
June 15 - Leonardo Siligato
Thinking about getting into oil trading? Here's why and how you should invest in oil, along with all the factors that affect the price of oil!
June 7 - Cristóbal Crespo
Interested in commodities trading but not sure where to start? Wondering how trading commodities is different from trading stocks? You've come to the right place...
May 3 - Jitan Solanki
Learn how leverage works in currency trading and why it's a double-edged sword.
April 6 - Ben Brown
Trading stocks is actually easier than you think. Let's find out how those crazy Wall Streeters do it.