Invesco’s (NYSE: IVZ) PowerShares unit, the fourth-largest U.S. issuer of exchange traded funds, introduced the PowerShares DB Optimum Yield Diversified Commodity Strategy Portfolio (NasdaqGM: PDBC) Friday, a new actively managed ETF that helps investors avoid pesky K-1 tax forms.
The PowerShares DB Optimum Yield Diversified Commodity Strategy Portfolio is another addition to PowerShares’ expansive lineup of smart beta, or alternatively-weighted ETFs. Illinois-based PowerShares was one of the first ETF issuers to emphasize the advantages of alternatively-weighted ETFs and currently offers 60 smart beta ETFs with track records greater than five years. [Institutions Run to Smart Beta ETFs]
The new PDBC is the 82nd ETF in the PowerShares smart beta stable.
“PDBC provides broad and efficient exposure to commodities with the added benefit of eliminating Scheduled K-1 requirements,” said Lorraine Wang, Invesco PowerShares head of global ETF products & research, in a statement. “Institutional investors allocate commodities into portfolios as an inflation hedge, and for the benefit of low correlation to stocks and bonds.”
PDBC, which charges 0.59% per year, tracks 14 commodities via futures contracts with weights ranging from 1.53% for silver to 12.33% for gasoline. The new ETF also allocates a combined 24.4% of its weight to West Texas Intermediate crude and heating oil futures. Gold futures account for 7.91% of the fund’s weight.