Investors who are crafting a diversified investment portfolio should consider commodity-related exchange traded fund exposure that helps provide non-correlated returns to traditional assets like stocks and bonds.
On the upcoming webcast, The Global Economy: Divergence, Commodities and the Dollar, Mike McGlone, head of U.S. research at ETF Securities, and Helen Henton, director commodities at Roubini Global Economics, discuss how investors should position their commodities exposure in a shifting market environment.
Currently, gold assets, such as the ETFS Physical Swiss Gold Shares (NYSEArca: SGOL), are weakening after the Federal Reserve hinted at a December interest rate hike. The higher interest rates would hurt non-yielding commodities, like gold, and strengthen the U.S. dollar, which would put further pressure on gold demand among foreign buyers since gold is priced in USD.
However, unlike gold, other white metals have strengthened on the improving economic outlook as many other precious metals have industrial applications. For instance, the ETFS Physical Silver Shares (NYSEArca: SIVR) and silver prices were still strengthening Wednesday after the Fed announcement. Silver is used in electronics and batteries.