ETFs in the commodity space have had an incredible run in 2010, with some funds gaining over 80% on the year and becoming some of the year’s top performers. Commodities across the board have enjoyed big gains this year due to a number of factors, including a shaky dollar, strong emerging markets demand, and various supply shortages around the world. Despite the impressive returns delivered recently (and in fact for much of the decade), there are still those who are hesitant to embrace commodities as an investable asset. For the majority of natural resources, it isn’t practical for investors to establish exposure to spot prices; storing crude oil in your basement of live cattle in your backyard isn’t exactly a recipe for investing success. That means that futures-based strategies are the next best choice, exposing investors to the nuances associated with rolling holdings as they approach expiration (i.e., contango and backwardation). The disconnect between hypothetical spot returns and the returns to a futures-based strategy have frustrated some investors who believe they made the right call on commodity prices but failed to realize the gains they expected [see Four ETF Strategies For Fighting Contango].
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Perhaps no corner of the ETF market has exploded as rapidly as the precious metals space, as the democratization of an asset class previously off limits to many investors has resulted in billions of dollars in cash inflows. The SPDR Gold Trust (GLD) is now the second-largest ETF by total assets, with more than $53 [...]
Commodities have been one of the hottest corners of the ETF market, exploding on to the scene in recent years as investors have rushed to gain access to a suddenly democratized asset class that has been shown to add valuable diversification benefits to traditional stock-and-bond portfolios [see Rethinking Commodity ETFs]. But some investors have been [...]
Another eventful week has passed us by, leaving investors with plenty to chew on as they try and figure out hectic markets. The week started off with the closing of four ETFs, as Claymore‘s said goodbye to IRO, CRO, EXB, and ROB as the four failed to attract any meaningful amount of assets [see Four [...]
By all accounts, the economic recovery that began in March 2009 and continued through the first four months of 2010 seemed to be on relatively solid footing. Earnings season in the U.S. got off to a relatively strong start, unemployment rates seemed poised to pull back, and the reluctant agreement of the (relatively) wealthy European [...]
After a few speed bumps early in 2010, ETFs are back on track and traveling full steam ahead. In the first three months of 2010, nearly 60 new ETFs have been launched, which is already equivalent to nearly half funds to hit the market over the course of 2009. The recent SEC decision to halt approval on products using derivatives may slow this pace a [...]
First Trust, the ETF issuer best known for its line of quant-based AlphaDEX funds, introduced two new ETFs last week that tap into an increasingly popular investment strategy. The First Trust ISE Global Platinum Index Fund (PLTM) and First Trust ISE Global Copper Index Fund (CU) join a number of other ETFs focused on mining [...]
