What is a Certificated Stock?
Certificated stocks are stocks of commodities that have been evaluated and found to be qualified for a classification of basis grade. Sometimes referred to as certified stocks, this designation of certificated stock often applies to physical commodities that are currently being stored or held at a designated physical location. Stocks of this classification can be utilized for delivery against a futures contract, with the actual asset held by the issuer until the time of transfer. The use of certificated stock is often used with various types of physical commodities, especially assets that are based on food products. Grains are an excellent example of an investment that would undergo this process of certification. Within this scenario, an appropriate exchange authority would inspect the grain and the value and quality verified by the authority. Once that process is complete, the grain would be considered acceptable for delivery on the contract, pending the establishment of the specific
