ETF Chart of the Day: Corn

January 30th at 11:00am by Paul Weisbruch, Street One Financial

Temperatures here in the Northeastern part of the U.S. are reaching towards 60 degrees here today on January 30th, which many are treating as an early taste of spring.

Groundhog Dog is next week, so the verdict is still not in if we are headed for an early spring or not, but nonetheless the mild weather is a welcome relief to most, even if it is temporary.

The weather presents an opportunity for us to rewind the clock back to last July 2nd, where we spoke about drought conditions that began to grip much of the U.S., particularly the Great Plains, and CORN (Teucrium Corn Fund, Expense Ratio 1.00%) among other crop based ETFs were in the spotlight as prices rose dramatically as the drought worsened throughout the summer leading into the fall.

After peaking at $52.71 in late August of last year, CORN has fallen back quite a bit, trading as low as $42.63 just at the beginning of this month. [Lower Crop Inventories Lift Grain ETFs]

Currently, the fund is clinging to its 200 day MA ($44.93) and volume has been quite light in recent sessions. The fund itself holds corn futures contracts, as traded on the CBOT and its goal is to deliver unleveraged direct exposure to the corn market.

During the drought last summer, the ETF would regularly trade more than 250,000 shares a day, with several sessions well north of that, but the fund itself only averages about 65,000 shares traded on a daily basis, so it tends to be very tied to the volatility surrounding actual corn (and other agricultural commodity) prices it seems.

This said, there is ample underlying liquidity present in the ETF, with or without volume, for those portfolio managers looking to embrace exposure in this segment, or perhaps other agricultural commodity segments of the market.

Many of these funds will likely become more in focus in the next 3-6 months as we head into the spring and summer seasons.

Teucrium Corn Fund

corn-etf

 

For more information on Street One ETF research and ETF trade execution/liquidity services, contact Paul Weisbruch at pweisbruch@streetonefinancial.com.

Tickers

CORN