Pacific Investment Management Co. has launched the PIMCO Commodity Strategy Active ETF (NYSE Arca: CMDT). The new actively managed ETF invests in a broad range of commodity-linked instruments. Investors can trade CMDT on the New York Stock Exchange effective Wednesday.
CMDT seeks to hedge against inflation and diversify investors’ portfolios. It will target diverse sources of excess returns by incorporating multi-factor considerations such as storage costs of physical commodities and historic performance trends.
“We’re seeing advisors shift their focus on passive commodity strategies based on macroeconomic developments,” said Todd Rosenbluth, head of research at VettaFi. “It is great to see a proven active manager like PIMCO offer a product like this.”
Persistent Elevated Inflation Is a Concern
“Persistent elevated inflation is a concern for investors who want to mitigate the negative effect of rising prices on their long-term savings,” said Greg Sharenow, CMDT’s head portfolio manager. “Historically commodities have acted as an effective hedge against inflation, and in today’s volatile markets we believe the asset class also is a compelling option for investors looking for a well-diversified portfolio.”
The launch of CMDT follows PIMCO in January the PIMCO Preferred and Capital Securities Active ETF (PRFD ). PRFD targets preferred and capital securities opportunities where investments may offer equity-like total returns with less volatility. Like CMDT – and many of PIMCO’s ETF offerings – PRFD is also actively managed.
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