With the first half of 2013 coming to an end, many investors are taking time to look back and see which portions of their portfolios will need revaluation, with many now worried that the commodity super cycle is drawing to a close. Though some commodities fared well in the first six month of the year, many failed to keep pace. Below, we outline the three worst performing commodities so far in 2013 to give investors a better idea of how the year is shaping up [for more commodity news and analysis subscribe to our free newsletter].
Silver – Down 35%
Precious metals took a big hit since the start of 2013, as investors have rushed into equities to play the recovering economy, and abandoning the assets they once considered safe havens. Silver has always had a volatile history, performing best as a hedge against inflation, but missing the mark during recovery years. The metal’s use in manufacturing and electronics has kept some demand for silver going, but with investors shifting investments away from this precious metal, silver prices have taken a nose dive.
Gold – Down 27%
After 12 years of positive returns, gold bugs were shocked to see their precious metal fall prey to the same outflows as any other precious metal. Gold has been seen by many as a key portfolio holding for the last decade, with the investing frenzy always reaching new highs after hard economic times. But after Fed talks early in the year and a Goldman Sachs recommendation to short, gold saw its largest single day drop in over 30 years this April and has only fallen from there [also see Why Gold Is Reach Its Bottom].
Coffee – Down 18%
Coffee was not only one of the worst performing assets this year, but also took a top spot in 2012, shedding nearly 38% as this popular beverage took a big hit in October. As a soft commodity, coffee is known for its volatility, but its recent stretch has been harsh even by the most stringent standards. To add insult to injury, poor weather patterns and crop harvest have only added to price volatility through the first half of 2013.
Disclosure: No positions at time of writing.