French banking behemoth BNP Paribas has become the latest financial institution to jump into the ETF industry, rolling out an exchange-traded commodity product this week. The new STREAM S&P Dynamic Roll Global Commodities Fund (BNPC) will seek to replicate the S&P GSCI Dynamic Roll Excess Return Index, a broad-based index of commodity futures that uses a flexible methodology to tilt the portfolio depending on prevailing market conditions. Like many commodity ETPs now on the market, BNPC will strive to maximize the yield from rolling futures contracts in backwardated markets and minimize the adverse impact of the roll process when futures markets are contangoed. [click to continue…]
With more than 1,400 exchange-traded products now available to U.S. investors, odds are that there will be more than one option for most desired exposures. In many cases, the generally similar products targeting a specific asset class or strategy will deliver generally similar returns. But just because two ETFs have names that sound alike or [...]
As some financial advisors are now well aware, the term “ETF” is often used rather liberally to refer to a variety of different exchange-traded products that generally function in the same manner from the perspective of an investor. More accurately, ETFs can be described as a type of exchange-traded product, or ETP, an umbrella that [...]
Commodity ETPs can be extremely powerful tools for tapping into an asset class capable of providing both return enhancement and diversification benefits. With dozens of products available–there are more than 120 U.S.-listed commodity ETFs according to the ETF screener–picking the right fund for your investment objectives and risk tolerances can be challenging. Beyond the type [...]
As natural resource prices have climbed skyward, interest in exchange-traded products that offer exposure to commodities has accelerated as well. While some investors prefer to achieve targeted access through resource-specific funds–such as those focusing on corn (CORN), sugar (SGG), or copper (JJC)–the most popular commodity ETPs are those that include a variety of types of [...]
The rise of the ETF industry has made commodity investing readily available to millions of investors whose options for exposure to this “fourth asset class” were previously limited. Most of the money in commodity exchange-traded products is in diversified funds offering exposure to more than a dozen natural resources through a single security (see a [...]
As U.S. equity markets have soared in recent months, the dollar has steadily declined against most of its major rivals, recently falling below the key $1.50 level against the euro for the first time since August of last year. This extended fall has investors wondering if the dollar’s decline reflects temporary volatility, or a long-term [...]
UBS, under its E-TRACS brand, launched a new exchange-traded note (ETN) yesterday that offers exposure to the DJ-UBS Commodity Index Total Return. This benchmark is designed to provide diversified commodity exposure based on the economic significance of each commodity. The index measures the collateralized returns on a basket of 19 commodity futures contracts representing energy, [...]
