Three Things Wall Street Journal Didn’t Tell You About Commodities
Investing in commodities has certainly picked up in recent years, but it seems that the overall industry has begun to experience some growing pains. As is common with newer investment types (not that commodities are new, but their heavy popularity is), analysts will lash out and tell investors why this asset class is bad news. Such is the case with a recent article in the Wall Street Journal entitled “The Case Against Commodities“. This piece outlines a number of the dangers and issues that come along with commodity investing. But investors shouldn’t take it at face value, as there are a number of factors that WSJ neglected to mention [see also Three Reasons Why Gold Is Overvalued].
The Guide To The Biggest Companies In Every Major Commodity Sector
Trading commodities has been popular for many years, as investors can use a number of different resources to gain access to their favorite commodity investments. But it was only a more recent development that commodities earned their keep in a long-term portfolio. Now, a small, but important, allocation to commodities is a necessity of any well diversified portfolio, as these investments offer a number of advantages such as hedging against inflation and maintaining low correlation levels to traditional asset classes [see also Commodity Investing: Physical vs. Futures].
Daily Commodity Roundup: Copper Gains On Housing Starts, Silver Crashes On Strong Equities
Markets saw a healthy rebound today as earnings season helped to lift equities from their dismal spin that has been in effect for the last few trading sessions. After gold made yet another historic run yesterday, it fell back below the $1,600 per ounce mark as investors gained some optimism on the U.S. plan to handle the enormous debt and the ceiling which we have just hit. Oil, on the other hand, made strong gains on the day, as it turned a gain of over 1.6% moving nicely along with equities. As for major commodity indexes, the UBS Bloomberg CMCI Index gained 14.5 points while the S&P GSCI saw a drop of about 6.3 points. While the strong economic indicators were good news for a handful of futures, it put downward pressure on others that are more closely aligned with safe haven appeal, as the risky commodities saw inflows at their expense … See the full story here
Daily Commodity Roundup: Silver Shines On Economic Woes, Cotton Tanks On Negative Outlook
Today saw markets further their plunge as fears of a U.S. default remained in investors’ minds. As it gets closer to the August second deadline, with the government failing to make any tangible progress on the debt ceiling, investors are growing more worried, which has sent equities on a roller coaster ride over the last few weeks. As for commodities, gold saw yet another historic breakthrough today as it finished above $1,600 per ounce for the first time ever. Gold’s climb proves that investors are more comfortable seeking safe havens for the time being in the precious metals arena, as they quickly move out of equity positions to wait out the storm. In aggregate, today saw the UBS Bloomberg CMCI index finish down 7.6 points while the S&P GSCI gained roughly 5.5 suggesting that commodities were pretty mixed overall.
Daily Commodity Roundup: Natural Gas Tumbles On Weather Outlook, Silver Rises On Safe Haven Demand
American equity markets rose modestly in Wednesday trading as worries over Greece and Portugal were overshadowed by solid performances out of blue chips in the consumer and the technology sectors. International markets were more mixed, however, as European indexes saw red across the board while Asia saw gains in Japan and Australia, but losses in India and China. In currency markets, the U.S. dollar gained against most of its major counterparts, led by a 1% gain against both the euro and British pound, ahead of the key central bank meetings for both of these currencies tomorrow. This made it a rough day for many commodities as the UBS Bloomberg CMCI, the RJ/CRB Commodity, and the Rogers International indexes all saw losses on the day, although the S&P GSCI index did manage to rise by about 11 points in the session.
