{"id":58086,"date":"2023-09-07T11:41:02","date_gmt":"2023-09-07T15:41:02","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/commodities-funds-are-a-buy-now-the-price-is-right\/"},"modified":"2023-09-07T11:41:05","modified_gmt":"2023-09-07T15:41:05","slug":"commodities-funds-are-a-buy-now-the-price-is-right","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=58086","title":{"rendered":"Commodities Funds Are a Buy Now. The Price Is Right."},"content":{"rendered":"
\n
<\/p>\n

<\/p>\n

<\/p>\n<\/figure><\/div>\n

Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to consider adding commodities to your core portfolio.<\/p>\n

The S&P GSCI commodity index, with energy its largest weighting, is down about 1% this year, while the Bloomberg Commodity Index, which is one-third energy, one-third metals, and the rest in other commodities, has tumbled 5.5%. The broader stock market is up 16%.<\/p>\n

\n

There are long-term reasons to hold the asset class: Commodities sit at the crossroads of three big investment themes\u2014elevated inflation, a changing China, and the transition from fossil fuels toward renewable energy. <\/p>\n

China, the world\u2019s biggest commodities consumer, is a driver of prices for raw materials from copper to crude oil. But tremors in its economy and property market have dampened the outlook even as commodity markets appear to be holding up.<\/p>\n

<\/p>\n

<\/p>\n

\n
\n\n\n\n\n\n\n\n\n\n\n\n\n\n
ETF \/ Ticker<\/th>\nFund Size (mil)<\/th>\nYTD Return<\/th>\n1-Yr Return<\/th>\n5-Yr Return<\/th>\nExpense Ratio<\/th>\n<\/thead>\n
Teucrium Sugar \/ CANE<\/b><\/td>\n$23<\/td>\n46.5%<\/td>\n57.1%<\/td>\n15.6%<\/td>\n0.58%<\/td>\n<\/tr>\n
United States Gasoline \/ UGA<\/b><\/td>\n74<\/td>\n17.9<\/td>\n32.7<\/td>\n15.4<\/td>\n0.97<\/td>\n<\/tr>\n
Carbon Strategy \/ KARB<\/b><\/td>\n1<\/td>\n10.6<\/td>\nN\/A<\/td>\nN\/A<\/td>\n0.75<\/td>\n<\/tr>\n
Invesco DB Oil \/ DBO<\/b><\/td>\n263<\/td>\n9.1<\/td>\n-2.1<\/td>\n6.4<\/td>\n0.75<\/td>\n<\/tr>\n
Invesco Agriculture Commodity Strategy No K-1 \/ PDBA<\/b><\/td>\n11<\/td>\n8.2<\/td>\n6.5<\/td>\n<\/td>\n0.59<\/td>\n<\/tr>\n
Invesco DB Agriculture \/ DBA<\/b><\/td>\n837<\/td>\n7.8<\/td>\n6.0<\/td>\n5.6<\/td>\n0.85<\/td>\n<\/tr>\n
iShares\u00ae Commodity Curve Carry Strategy \/ CCRV<\/b><\/td>\n26<\/td>\n7.8<\/td>\n8.7<\/td>\nN\/A<\/td>\n0.40<\/td>\n<\/tr>\n
United States 12 Month Oil \/ USL<\/b><\/td>\n74<\/td>\n7.6<\/td>\n3.5<\/td>\n8.4<\/td>\n0.85<\/td>\n<\/tr>\n
ProShares K-1 Free Crude Oil Strategy \/ OILK<\/b><\/td>\n115<\/td>\n7.4<\/td>\n2.3<\/td>\n-5.7<\/td>\n0.71<\/td>\n<\/tr>\n
United States Oil \/ USO<\/b><\/td>\n1,324<\/td>\n7.3<\/td>\n2.2<\/td>\n-8.6<\/td>\n0.60<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Note: Data through Aug. 31. Five-year returns are annualized. N\/A=not applicable<\/p>\n

Source: Morningstar Direct<\/p>\n<\/div><\/div>\n<\/p><\/div>\n

\u201cConcerns about the demand outlook have weighed on commodities all year,\u201d says Roland Morris, a commodity strategist and portfolio manager at VanEck. While performance has been lackluster, the asset class has held up fairly well, he adds. <\/p>\n

\u201cIf you think of the fundamental headwinds we\u2019ve had this year, it\u2019s pretty impressive actually,\u201d he says. \u201cChina\u2019s growth has been incredibly disappointing, and Europe\u2019s in a recession.\u201d<\/p>\n

In August, VanEck launched the
\n VanEck CMCI Commodity Strategy
\n exchange-traded fund (ticker: CMCI). The ETF is based on the same underlying index\u2014the UBS Constant Maturity Commodity Index\u2014as its mutual fund sibling (CMCAX), which has $576 million in assets. The mutual fund launched in 2010 and has a four-star, gold-medal rating from Morningstar. It has returned 2.6% this year.<\/p>\n

Kathy Kriskey, senior commodities ETF strategist at Invesco, is positive about the outlook for the second half of the year. \u201cWe\u2019re seeing the tide turn,\u201d she says. \u201cI am still cautiously optimistic that things will sort themselves out in China and we will continue to see demand growing out of China.\u201d While not a basic building block like stocks or bonds, says Kriskey, it\u2019s reasonable for investors to have commodities make up 5% to 8% of their portfolios. <\/p>\n

Commodities have long been considered a way to offset the risk of rising inflation. Even though inflation has come down from a peak rate of 9.1% last summer, it\u2019s still above 3%. \u201cWe believe that an inflation hedge is necessary because inflation is sticky,\u201d she says.<\/p>\n

Pimco is also betting on commodities as an inflation hedge. In May, the firm launched its first commodities ETF, the actively managed
\n Pimco Commodity Strategy Active
\n (CMDT). The goal of the strategy is \u201cto provide a hedging solution for inflation,\u201d says Greg Sharenow, the fund\u2019s portfolio manager.<\/p>\n

The fund, which will invest in a broad range of commodity-linked instruments, has already amassed more than $197 million in assets. It\u2019s off to a good start: Three-month total returns stand at 12.2%; it outperformed 87% of funds in its category, according to Morningstar. \u201cWe believe that real assets are going to be a major portion of portfolio construction over the next five to 10 years,\u201d says Sharenow. <\/p>\n

Others aren\u2019t so certain. \u201cBroad commodities probably shouldn\u2019t be part of a long-term portfolio strategy,\u201d says Rob Haworth, senior investment strategy director at U.S. Bank Wealth Management. \u201cYou\u2019re not sufficiently compensated for the risk. They may generate equity-like returns, but typically with much more volatility and unpredictability.\u201d<\/p>\n

If China\u2019s economy continues to slow, investors will need to buckle up as commodities are probably in for more volatility. But metals critical to energy transition, such as copper, could fare better. <\/p>\n

Write to <\/strong>Lauren Foster at lauren.foster@barrons.com<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to consider adding commodities to your core portfolio. The S&P GSCI commodity index, with energy its largest weighting, is down about 1% this year, while the Bloomberg Commodity Index, […]<\/p>\n","protected":false},"author":1,"featured_media":58087,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-58086","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nCommodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=58086\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Commodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld\" \/>\n<meta property=\"og:description\" content=\"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to\" \/>\n<meta property=\"og:url\" content=\"https:\/\/ifintechworld.com\/?p=58086\" \/>\n<meta property=\"og:site_name\" content=\"iFintechWorld\" \/>\n<meta property=\"article:published_time\" content=\"2023-09-07T15:41:02+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-09-07T15:41:05+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/09\/1694101263_social.jpeg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"640\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"News Room\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"News Room\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/ifintechworld.com\/?p=58086#article\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=58086\"},\"author\":{\"name\":\"News Room\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\"},\"headline\":\"Commodities Funds Are a Buy Now. The Price Is Right.\",\"datePublished\":\"2023-09-07T15:41:02+00:00\",\"dateModified\":\"2023-09-07T15:41:05+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=58086\"},\"wordCount\":703,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"keywords\":[\"Featured\"],\"articleSection\":[\"Markets\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/ifintechworld.com\/?p=58086#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/ifintechworld.com\/?p=58086\",\"url\":\"https:\/\/ifintechworld.com\/?p=58086\",\"name\":\"Commodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/#website\"},\"datePublished\":\"2023-09-07T15:41:02+00:00\",\"dateModified\":\"2023-09-07T15:41:05+00:00\",\"description\":\"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to\",\"breadcrumb\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=58086#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/ifintechworld.com\/?p=58086\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/ifintechworld.com\/?p=58086#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/ifintechworld.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Commodities Funds Are a Buy Now. The Price Is Right.\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/ifintechworld.com\/#website\",\"url\":\"https:\/\/ifintechworld.com\/\",\"name\":\"Repay Down\",\"description\":\"Latest Personal Finance News, Tips and Updates\",\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/ifintechworld.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/ifintechworld.com\/#organization\",\"name\":\"Repay Down\",\"url\":\"https:\/\/ifintechworld.com\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"width\":558,\"height\":90,\"caption\":\"Repay Down\"},\"image\":{\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\",\"name\":\"News Room\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"caption\":\"News Room\"},\"sameAs\":[\"https:\/\/ifintechworld.com\"],\"url\":\"https:\/\/ifintechworld.com\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Commodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld","description":"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/ifintechworld.com\/?p=58086","og_locale":"en_US","og_type":"article","og_title":"Commodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld","og_description":"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to","og_url":"https:\/\/ifintechworld.com\/?p=58086","og_site_name":"iFintechWorld","article_published_time":"2023-09-07T15:41:02+00:00","article_modified_time":"2023-09-07T15:41:05+00:00","og_image":[{"width":1280,"height":640,"url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/09\/1694101263_social.jpeg","type":"image\/jpeg"}],"author":"News Room","twitter_card":"summary_large_image","twitter_misc":{"Written by":"News Room","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/ifintechworld.com\/?p=58086#article","isPartOf":{"@id":"https:\/\/ifintechworld.com\/?p=58086"},"author":{"name":"News Room","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61"},"headline":"Commodities Funds Are a Buy Now. The Price Is Right.","datePublished":"2023-09-07T15:41:02+00:00","dateModified":"2023-09-07T15:41:05+00:00","mainEntityOfPage":{"@id":"https:\/\/ifintechworld.com\/?p=58086"},"wordCount":703,"commentCount":0,"publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"keywords":["Featured"],"articleSection":["Markets"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/ifintechworld.com\/?p=58086#respond"]}]},{"@type":"WebPage","@id":"https:\/\/ifintechworld.com\/?p=58086","url":"https:\/\/ifintechworld.com\/?p=58086","name":"Commodities Funds Are a Buy Now. The Price Is Right. | iFintechWorld","isPartOf":{"@id":"https:\/\/ifintechworld.com\/#website"},"datePublished":"2023-09-07T15:41:02+00:00","dateModified":"2023-09-07T15:41:05+00:00","description":"Commodities had a starring role in 2022 and 2021, but lost their shine this year as China\u2019s economy sputtered. At these prices, it could be time to","breadcrumb":{"@id":"https:\/\/ifintechworld.com\/?p=58086#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/ifintechworld.com\/?p=58086"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/ifintechworld.com\/?p=58086#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/ifintechworld.com\/"},{"@type":"ListItem","position":2,"name":"Commodities Funds Are a Buy Now. The Price Is Right."}]},{"@type":"WebSite","@id":"https:\/\/ifintechworld.com\/#website","url":"https:\/\/ifintechworld.com\/","name":"Repay Down","description":"Latest Personal Finance News, Tips and Updates","publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/ifintechworld.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/ifintechworld.com\/#organization","name":"Repay Down","url":"https:\/\/ifintechworld.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","width":558,"height":90,"caption":"Repay Down"},"image":{"@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61","name":"News Room","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","caption":"News Room"},"sameAs":["https:\/\/ifintechworld.com"],"url":"https:\/\/ifintechworld.com\/?author=1"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/58086","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=58086"}],"version-history":[{"count":1,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/58086\/revisions"}],"predecessor-version":[{"id":58088,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/58086\/revisions\/58088"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/media\/58087"}],"wp:attachment":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=58086"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=58086"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=58086"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}