It is stating the obvious, but MOO does need the benefit of higher agriculture commodities prices and even in that case, the reaction of agribusiness stocks to those higher commodities prices is often delayed. That says patience is a virtue with MOO and a virtue that could be tested.
To be fair, MOO is not the only agriculture-related ETF that investors are departing. Agriculture ETFs were beloved by investors through the first quarter and into the early part of the second quarter as uncooperative weather conditions lifted prices for commodities ranging from coffee to cocoa and fears of depressed supply elevated livestock prices. [Investors Leave Ag ETFs as Crop Yields Rise]
Robust corn and soybean crops prompted almost $134 million in third-quarter outflows from the PowerShares DB Agriculture Fund (NYSEArca: DBA).
Market Vectors Agribusiness ETF
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of QQQ and SPY.