The following table summarises the expected annual returns
of a 10 year holding period for a group of commonly traded ETC funds. Our
valuation method is based on a long term reversion to the mean. A full
description of the valuation method can be read here.
Commodity
|
Ticker
|
Annualised Return
|
Current Trend
|
Trend start
date
|
Natural Gas
|
NGAS
|
15.44%
|
UP
|
19th July
2012
|
Crude Oil
|
CRUD
|
3.62%
|
DOWN
|
14th May 2012
|
Coffee
|
COFF
|
2.82%
|
DOWN
|
20th July
2011
|
Cocoa
|
COCO
|
2.26%
|
UP
|
3rd August 2012
|
Sugar
|
SUGA
|
1.59%
|
DOWN
|
17th November
2011
|
Wheat
|
WEAT
|
1.35%
|
UP
|
18th May 2012
|
Copper
|
COPA
|
1.32%
|
DOWN
|
23rd May 2012
|
Cotton
|
COTN
|
1.17%
|
UP
|
17th October 2012
|
Platinum
|
SPLT
|
1.13%
|
UP
|
7th September
2012
|
Soybean Oil
|
SOYO
|
0.74%
|
UP
|
4th September 2012
|
Heating Oil
|
HEAT
|
0.58%
|
UP
|
4th September
2012
|
Silver
|
SSLN
|
-0.66%
|
UP
|
4th September 2012
|
Gold
|
SGLN
|
-1.19%
|
UP
|
31st August
2012
|
Soybeans
|
SOYB
|
-2.02%
|
UP
|
21st February 2012
|
Corn
|
CORN
|
-2.05%
|
UP
|
26th June
2012
|
The current trend indicates whether the most recent breakout
of the 100 day price channel was to the upside or the downside. As commodities
tend to trend more strongly than most other asset classes it's crucial to trade
in the direction of the trend. I've also included the date that the trend
changed as some of these trends can continue for several years. The current
longest trend is the 15 month downtrend in coffee prices. Before natural gas
changed to an uptrend in July this year it had been on a 4 year downtrend.
No major changes. A few commodities have changed the direction of their trends but natural gas still remains the most attractive commodity to invest in at present:
Going forward further falls in crude oil and coffee could produce investing opportunities in the future.
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