ETF Trends
ETF Trends

Commodities and their related exchange traded funds (ETFs) are on pace for their worst week in nearly 50 years.

Commodities, as measured by the Reuters/Jefferies CRB Index of 19 raw materials, have lost 9.9% this week – the most since at least 1956, reports Glenys Sim for Bloomberg. The UBS Bloomberg CMCI Index of 26 raw materials is having its worst week since 1997, after skepticism that the government’s bailout plan won’t be enough to stimulate demand for commodities.

As economic weakness continues, it could continue to weigh down commodities. Oil, copper and corn all lost ground this week.

  • iShares S&P GSCI Commodity Indexed Trust (GSG) lost 12.3% this week. The fund tracks a broad index of 24 commodities weighted according to the proportion of the commodity flowing through the economy. Almost half of the index reflects crude oil, and the balance is split between other energy products such as natural gas as well as agricultural commodities, industrial and precious metals, and livestock.
  • The iPath Dow Jones-AIG Commodity Index Fund ETN (DJP), which tracks an index that comprises 30% energy, 30% agricultural, 20% industrial metals, 10% livestock and 10% precious metals. The fund has lost 11.4% this week.

Commodity Exchange Traded Funds (ETFs)

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.