ETF Spotlight on Teucrium Corn (NYSEArca: CORN), part of a weekly series.
Assets: $57 million
Objective: Seeks to replicate a basket of three corn futures contracts
Holdings: CORN holds three corn futures contracts; the second-to-expire contract is weighted 35%; the third-to-expire is weighted 30%; the December futures contract (after the third-to-expire contract) is weighted 35%. Strategies that vary the time of the contract’s roll help mitigate the corrosive effects of contango.
What You Should Know
- CORN is the only ETF that gives investors a pure-play on corn futures contracts
- Its launch couldn’t have come at a better time: since it began trading in June 2010, it has gained 60.4%
- CORN charges a 1% expense ratio
- Teucrium, the ETF provider behind CORN, is an operation staffed by commodities experts; at one point or another, they’ve all traded commodities
- The provider offered CORN first, because it’s one of the most ubiquitous commodities
The Latest News
- Corn prices are at 30-month highs and rose 75% in 2010 alone
- Bad weather and rising demand are the biggest culprits
- In a recent poll, 63% of farmers said they were holding onto corn reserves in the expectation of further price gains
- Corn supplies are projected to decline 14% this year
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.