Archive | Commodity ETFs

Dealing with Contango

Investing in commodities has been made much easier by the advent of exchange traded funds.  However, one issue that has been a drag on returns and has investors scratching their heads is contango. Contango, and its opposite number — backwardation, occurs in funds that track commodity prices with futures contracts.  Since the contracts have a […]

Strong Dollar Hurting Copper ETFs

Copper ETFs are Seeing Red in 2010 according to the WSJ’s John Spence. Turns out that the strengthening US dollar is bringing down commodity prices.  Combine that with a more uncertain economic outlook and funds that specialize in economically sensitive commodities like copper take a hit. Spence highlights two copper exchange traded products – the […]

Buying Gold at the Top

The market correction and the European debt crisis have renewed investors’ interest in gold, pushing the commodity’s price levels to new highs. Is there a way to safely buy gold at these levels without exposing your portfolio to the risk of a sudden crash in gold prices?  That’s the question asked by the WSJ’s Brett […]

Platinum and Palladium Get a Lift from ETFs

Platinum and palladium prices are climbing higher thanks to the recent introduction of two new ETFs according to a WSJ article by Matt Whittaker and Carolyn Cui. The ETFS Physical Platinum Shares (PPLT) and ETFS Physical Palladium Shares (PALL) began trading on January 8.  Since that time, both funds have each accumulated 100,000 ounces of […]

Silver and Gold as Diversifying ETFs

Stocks and commodities have moved in lock step over the past 15 months, thwarting investors seeking to diversify their portfolios. However, silver and gold proved to be able diversifying investments. In the article Stocks, Commodities Are Unlikely Buddies, the WSJ’s San Mamudi reports that funds that track the S&P 500 are up 26% this year […]

Gold Mutual Funds vs Gold ETFs

The Journal‘s Tom Lauricella recently took a look at whether investors should own gold stocks or ETFs that track the price of gold. Since gold miners have leveraged exposure to the price of gold, gold mining stocks tend to be more volatile than the price of the metal. Gold stocks are also subject to other […]

Oil ETF Returns Watered Down

ETFs that are supposed to track the spot price of oil have underperformed this year. In the column Exchange-Traded Funds Miss Oil Gusher, the WSJ’s John Jannarone writes that although oil prices have soared 51% this year, the largest oil ETF, U.S. Oil Fund (USO), has risen 8%. USO attempts to track the spot price […]

Small ETF Investors Squeezed Out by Regulators

US regulators’ war on speculation is resulting in collateral damage – the small investor. According to the WSJ’s Brian Baskin‘s article Small Investors Face Big Hit in ETF Push, exchange-traded fund investors are victims of the CFTC’s crack down on commodity markets. Commodity ETFs have ballooned to $59.3 billion by providing small investors an avenue […]

Option Traders Expect More Volatility for Gold Miners

The WSJ‘s Tennille Tracy is reporting that options traders are preparing for increased volatility in the stocks of gold mining companies. In yesterday’s trading, options investors were establishing a “strangle” position in the Market Vectors Gold Miners ETF (GDX) by buying March $30 puts and March $45 calls. The position will only be profitable if […]

Are ETFs Driving Commodity Prices?

John Hyland, CIO of U.S. Commodity Funds, is one of several people expected to testify on Wednesday at a Commodity Futures trading commission hearing on the issue of speculation. The question to be answered, according to WSJ reporter Carolyn Cui, is whether commodity ETFs are influencing the price of the futures they are designed to […]

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