Given the uptick in market uncertainty with geopolitical flare ups, interest rate concerns and spike in market volatility, ETF investors have increasingly looked for new ideas to diversify their investment portfolios.
On the upcoming webcast (available live and on demand for CE Credit), End of Year Market Outlook, Timothy Seymour, Contributor for CNBC, James Butterfill, Head of Research and Investment Strategy for ETF Securities, and Matt Collins, Head U.S. Product Operations and Capital Markets at ETF Securities, will outline current market conditions, point out some market risks that are giving market participants a headache and offer some ideas like commodities to help investors diversify a portfolio.
As the rest of the year unfolds, investors should consider the various risks that could crop up and look for ways to hedge against the unknown, especially with U.S. equities looking pricey in an extended bull market.
Investors interested in diversifying their portfolios with commodities exposure have a number of ETF options available to them. For instance, ETF Securities recently came out with a line of ETFs to outperform the widely observed Bloomberg Commodity Indices without the need to worry about troublesome K-1 forms come tax season, including the actively managed ETFS Bloomberg All Commodity Strategy K-1 Free ETF (NYSEArca: BCI) and ETFS Bloomberg All Commodity Longer Dated Strategy K-1 Free ETF (NYSEArca: BCD).
BCI tries to provide long-term capital appreciation that exceeds the performance of the Bloomberg Commodities Index. It may not invest in all the components of the benchmark but will hold similar interests to those included in the index, along with short-term investment-grade fixed-income securities, money market instruments, certain bank instruments and cash or other cash alternatives. The underlying Bloomberg Commodities Index tracks the price of rolling positions in a basket of commodity futures with a maturity between 1 and 3 months.