Bloomberg Commodity Index Methodology
In the CMCI universe you can choose freely between constant maturities of three, six and twelve months, and two to five year maturities for certain commodities. This can be done either selectively for individual commodities to diversify over time or collectively for all those included in the index to diversify both across commodities and over time.In periods of persistent contango, this allows you to place your futures exposure at more favourable (i.e. Less positively sloping) sections of the futures curve and keep it there. This will prevent your investment slipping into the steeper part of the curve, with its associated higher roll costs.
Innovative Access to Commodities 2. Source: Bloomberg, based on annualized index returns from 3/31/2013-3/31/2019. Broad Commodities = excess performance of Bloomberg Roll Select Commodity Index vs. Bloomberg Commodity Index. Industrial Metals = excess performance of Bloomberg Roll Select Industrial Metals Index vs Bloomberg Industrial Metals.
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It is not possible to invest directly in an index. Backtested performance is not actual performance. Past performance is not an indication of future results.
Bloomberg Commodity Index 2018
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Eafe Index
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The best commodity ETFs How do I invest in a broad commodities basket?Investing in commodities is considered risky. However, from a diversification perspectiveit can be interesting to invest in commodities. Especially, the historically negative correlationof commodities to stocks can improve portfolio diversification. A commodities investment isgenerally realised through an investment in forward or futures contracts.
Commodity indicesusually track a basket commodities.There are several indices available to invest within a broad basket of commodities. There are also subindices on single or selected commodity segments,which are usually derived from the indices mentioned. This Investment Guide will help you navigate between thepeculiarities of commodity indices that vary substantially in their methodologies and ETFs thattrack them. It will allow you to find the most suitable ETFs for you by ranking themaccording to your preferences.
Bloomberg CommodityCommerzbank Commodity ex-Agriculture EWRogers International Commodity (RICI)Number of ETFsNumber of commodities211237Index reviewannuallysemi-annuallyannuallySelection critieriaEconomic significance (production), diversification, continuity and liquidityLiquidity and importanceGlobal consumption and liquidityIndex weighting1/3 production2/3 liquidityEqual weightGlobal consumption (reviewed by the RICI committee)Cap on single commodity15%8.33%-Cap on commodities segment33%. S&P GSCI© Energy & Metals Capped Commodity 35/20Thomson Reuters/ CoreCommodity CRBUBS Bloomberg CMCINumber of ETFs0 ETFsNumber of commodities1929Index reviewannuallymonthlymonthlySelection criteriaGlobal production (last 5 years)Liquidity and importance (reviewed by a committee)Fundamental factors and liquidityIndex weightingGlobal productionGrupped by liquidity and equally weighted in four groups2/3 fundamental factors1/3 liquidityCap on single commodity35% largest commodity20% all others-35% largest commodity20% all othersCap on commodities segment-Source: justETF Research; As of.