Best & Worst Performing Commodity ETFs

Best & Worst Performing Commodity ETFs

Commodities haven’t been left out of this year’s financial market rally.

sumit
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Senior ETF Analyst
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Reviewed by: Sumit Roy
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Edited by: Sumit Roy

In a year in which financial assets across the board have surged, commodities haven’t been left out.

The asset class is on track to finish 2019 with double-digit percentage gains, the best showing since 2016. One widely followed marker of commodity returns, the S&P GSCI Spot Index, is up 12.3% year to date, clawing back some of 2018’s 15.4% loss.

To be sure, commodities aren’t suddenly roaring back to life. Based on the spot index, the asset class is still down 7.5% over the past five years; 14% over the past 10 years; and a whopping 53% since its peak in July 2008.

Meanwhile, the S&P GSCI Total Return Index, which measures the actual experience of holding commodity futures and rolling them over one month to the next, has delivered even worse returns: a loss of 29% over the past five years; a loss of 41% over the past 10 years; and a 77% loss since the 2008 peak.

Clearly, commodities are still very much depressed relative to where they were a decade ago, but there are some notable bright spots within the group. Certain individual commodities and commodity ETFs have strongly outpaced even equities this year, and those are the ones we’ll be taking a look at below.

 

Best-Performing Commodity ETFs Of The Year (excluding leveraged/inverse)

TickerFundYTD Returns (%)
PALLAberdeen Standard Physical Palladium Shares ETF51.62%
UGAUnited States Gasoline Fund LP36.19%
JJNiPath Series B Bloomberg Nickel Subindex Total Return ETN30.88%
BNOUnited States Brent Oil Fund LP29.94%
USOUnited States Oil Fund LP27.33%
USOICredit Suisse X-Links Crude Oil Shares Covered Call ETN27.09%
OILiPath Series B S&P GSCI Crude Oil ETN27.06%
OILXETRACS S&P GSCI Crude Oil Total Return ETN26.99%
OLEMiPath Pure Beta Crude Oil ETN26.00%
OILKProShares K-1 Free Crude Oil Strategy ETF25.33%
USLUnited States 12 Month Oil Fund LP23.50%
DBOInvesco DB Oil Fund22.79%
AOILAberdeen Standard Bloomberg WTI Crude Oil Strategy K-1 Free ETF20.55%
GSCGS Connect S&P GSCI Enhanced Commodity TR Strategy ETN19.51%
PLTMGraniteShares Platinum Trust17.98%
PPLTAberdeen Standard Physical Platinum Shares ETF17.81%
RJNElements Rogers International Commodity Index-Energy TR ETN17.48%
PGMiPath Series B Bloomberg Platinum Subindex Total Return ETN17.44%
GLTRAberdeen Standard Physical Precious Metals Basket Shares ETF17.07%
JOiPath Series B Bloomberg Coffee Subindex Total Return ETN16.56%

Data measures total returns for the year-to-date period through Dec. 11.
 

Undisputed No. 1

The undisputed leader in the commodity space this year has been palladium. The Aberdeen Standard Physical Palladium Shares ETF (PALL), with more than $300 million in assets under management, surged 51.6% this year as palladium prices hit record highs above $1,940/oz.

Incredibly, palladium prices are not only trading at a 33% premium to current gold prices, they are also trading above the all-time high for gold, which was $1,921, set in 2011.

Palladium demand is on track to outpace palladium supply for the eighth year in a row, according to Johnson Matthey . The metal is coveted for its role as an autocatalyst, which reduces vehicle pollution and is often mandated by governments.

The Oil Complex Rebounds

The next-best-performing commodity ETFs this year behind palladium target the oil complex. The United States Gasoline Fund LP (UGA), the United States Brent Oil Fund LP (BNO) and the United States Oil Fund LP (USO) have gained 27-36% this year.

Let’s be clear. Oil is in no way, shape or form in a bull market. Current prices in the $60 range are well off 2018’s high of around $80. That’s even with the 1.2 million barrels per day of OPEC production cuts that are in effect.

U.S. crude oil production, which is up more than 1 million barrels per day this year, has simply been too much of a head wind for prices. Still, anyone who bought oil-tracking ETFs after the sell-off at the end of last year is sitting with respectable gains.

Gold Breaks Out

The aforementioned palladium isn’t the only precious metal rallying this year. Fellow autocatalyst platinum has also risen, though by much less. The GraniteShares Platinum Trust (PLTM), with $116 in AUM, gained 18% on a year-to-date basis, a decent return. But bigger picture, platinum prices are still relatively depressed, trading at half the levels of palladium as supply outstrips demand by a wide margin.

Meanwhile, the most prominent precious metal of all—gold—made some moves of its own in 2019. The GraniteShares Gold Trust (BAR), the SPDR Gold MiniShares Trust (GLDM) and the SPDR Gold Trust (GLD) each gained more than 14.5%.

While still well off their record highs, gold prices decisively broke out this year, briefly topping the $1,550 level for the first time in six years. Prices are about $100 off those levels currently, but the yellow metal remains in demand as investors look for alternatives to safe-haven government bonds, many of which are yielding close to nothing.

Other Winners

Other notable ETFs tracking individual commodities to do well this year include the iPath Series B Bloomberg Nickel Subindex Total Return ETN (JJN), up 30.9%; the iPath Series B Bloomberg Coffee Subindex Total Return ETN (JO), up 16.7%; and the Aberdeen Standard Physical Silver Shares ETF (SIVR), up 8.7%.

In addition to the single-commodity ETFs mentioned, a handful of broad commodity index ETFs are also among the best performers this year. The GS Connect S&P GSCI Enhanced Commodity TR Strategy ETN (GSC), the iPath S&P GSCI Total Return Index ETN (GSP) and the iShares S&P GSCI Commodity Indexed Trust (GSG) are each up double-digit percentages in 2019.

Worst-Performers

Taking a quick look at the worst-performing commodity ETFs of the year, we find a trio of natural gas products headlining. The iPath Series B Bloomberg Natural Gas Subindex Total Return ETN (GAZ), the United States Natural Gas Fund LP (UNG) and the United States 12 Month Natural Gas Fund LP (UNL) shed 19-37% this year.

Supplies of natural gas are bursting at the seams as the U.S. produces record amounts of the fuel. Natural gas is primarily used for heating and electricity generation. But even though demand for the fuel has risen solidly in recent years, it hasn’t been enough to absorb the enormous amounts of supply.

In addition to natural gas, several agricultural commodities have also fared poorly this year, no doubt weighed down by the U.S.-China trade war.

The Teucrium Corn Fund (CORN), the iPath Series B Bloomberg Cotton Subindex Total Return ETN (BAL), the iPath Series B Bloomberg Livestock Subindex Total Return ETN (COW) and the Teucrium Wheat Fund (WEAT) lost 8-11% so far this year.

For a full list of the worst performers, see the table below:

 

Worst-Performing Commodity ETFs Of The Year (ex. leveraged/inverse)

TickerFundYTD Returns (%)
GAZiPath Series B Bloomberg Natural Gas Subindex Total Return ETN-37.02%
UNGUnited States Natural Gas Fund LP-30.31%
UNLUnited States 12 Month Natural Gas Fund LP-19.07%
CORNTeucrium Corn Fund-11.28%
BALiPath Series B Bloomberg Cotton Subindex Total Return ETN-11.05%
JJTiPath Series B Bloomberg Tin Subindex Total Return ETN-9.28%
GRUElements MLCX Grains Index-Total Return ETN-8.59%
COWiPath Series B Bloomberg Livestock Subindex Total Return ETN-8.16%
WEATTeucrium Wheat Fund-8.09%
TAGSTeucrium Agricultural Fund-7.92%
FUEElements MLCX Biofuels Index-Total Return ETN-7.89%
JJGiPath Series B Bloomberg Grains Subindex Total Return ETN-7.14%
JJUiPath Series B Bloomberg Aluminum Subindex Total Return ETN-6.78%
SOYBTeucrium Soybean Fund-6.43%
RJAElements Rogers International Commodity Index-Agriculture TR ETN-4.64%
FUDETRACS UBS Bloomberg CMCI Food Total Return ETN-4.60%
SDCIUSCF SummerHaven Dynamic Commodity Strategy No K-1 Fund-4.58%
USCIUnited States Commodity Index Fund-4.45%
UAGETRACS UBS Bloomberg CMCI Agriculture Total Return ETN-3.71%
DBAInvesco DB Agriculture Fund-3.01%

Data measures total returns for the year-to-date period through Dec. 11.

Email Sumit Roy at [email protected] or follow him on Twitter sumitroy2

Sumit Roy is the senior ETF analyst for etf.com, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining etf.com, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for etf.com, with a particular focus on stock and bond exchange-traded funds.

He is the host of etf.com’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays, etf.com’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.