re: Agricultural ETFs...
I look to the agricultural ETF's for a little diversification
away from gold and pm stocks.
Here's a one year chart on the Agri ETF/ETNs vs. the dollar,
gold, and TIPs. Not the leverage to a weak dollar of the
HUI/GDX, but respectable returns...
Tradingwise, they peaked a month later than gold, hitting
their highs at the end of December, then pulled back into
January on US Dollar strength, bottoming in February, and
are turning up again here...
Over the last year they've traded in an approximate 20%
trading range, so they don't have the high-beta volatility
of the metals, or individual pm stocks.
As a group, they're never going to outperform PM's as an
anti-dollar trade over any extended period of time. Individual
commodities - yes, as a group - no.
Tradingwise, you can pick and choose them based on the
weighting they carry to individual commodities. The GRU
ETN for example, has a 47% weighting to wheat, so if you
prefer to trade ETF/ETNs instead of commodity futures, you
can pick an ETF with heavier weighting to your desired
commodity play.
If you're looking for a little diversification and a place
to park some cash while maintaining negative US dollar
correlation, they're worth a look, especially on pullbacks.
SOTB
PS: And don't ignore TIP as place to park cash.
A nice solid, steady +10% return over the last year,
and a lot less volatility than the Agri ETF & ETNs.
PPS: You can buy options (sell puts etc.)to enhance your
returns on both TIP and DBA. |
