ETF Trends
ETF Trends

A large trader used a pair of ETFs to swap out of the agriculture sector and into a sizable oil position on Wednesday. The $60 million trade shows how institutional investors and hedge funds are using liquid ETFs to trade sectors and asset classes.

Shortly after 11 am Eastern on Wednesday, a big trader appears to have sold about $60 million worth of PowerShares DB Agriculture Fund (NYSEArca: DBA) and rolled the proceeds into PowerShares DB Oil Fund (NYSEArca: DBO).

Trading volume in oil ETFs exploded Wednesday as crude futures fell sharply for the third straight session. [Oil ETFs Plummet 7% on Week as Volume Spikes]

Trading spreads remained tight in the two commodity ETFs amid the heavy volume and volatility.

The DBA/DBO swap is another example of hedge funds and institutions turning to ETFs for large trades, and their comfort in the products’ liquidity and tight spreads.

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