Commodities are known as the raw materials for production processes. Investing in them provides investors with exposure to unique factors that historically have brought diversification and inflation hedging benefits to traditional portfolios. Nowadays, ETFs have expanded the availability of commodity investments providing exposure to single commodities and commodity-linked indexes. At the same time, ETFs have exposed investors to a new set of risk factors that may be unfamiliar to the average investor.
This channel is designed to help you understand commodity ETFs, how they work, how they are built, their risks and their rewards, so that you can decide if commodity ETFs deserve a place in your portfolio.
With 110 ETFs traded in the U.S. markets, Commodities ETFs gather total assets under management of $87.76B. The average expense ratio is 0.81%. Commodities ETFs can be found in the following asset classes:
The largest Commodities ETF is the SPDR Gold Trust GLD with $49.25B in assets. In the last trailing year, the best performing Commodities ETF was the DGAZ at 284.99%. The most-recent ETF launched in the Commodities space was the ETRACS Bloomberg Commodity Index Total Return ETN Series B DJCB in 10/24/19.