Commodities have been performing remarkably well this year. The Bloomberg Commodity Index, a widely viewed measure of broad commodities prices, rose 5.7% in the first half of this year. Most of the rally was driven by higher prices for coffee, silver and oil.
While most commodity ETFs have been soaring, abrdn Physical Silver Shares ETF SIVR, United States Oil Fund USO, United States Copper Index Fund CPER, Invesco DB Agriculture Fund DBA and GraniteShares Gold Trust BAR have been the show stealers so far this year.
Precious metals like gold and silver took flight this year, outperforming the broad market returns. The yellow metal advanced 13.4% in the first half on expectations of U.S. interest rate cuts, increased demand from China, strong safe-haven appeal and strong central bank buying.
Meanwhile, silver prices climbed above the $30-an-ounce mark for the second time in the first half of 2024 on higher industrial and manufacturing demand. The global push for green energy, increasing demand in areas like 5G, a rebound in global computer shipments, increased use of silver in modern solar panels and automotive industries, and new sources of demand for sensors used in IoT and OLED lighting are propelling silver demand.
Industrial metals, such as copper and nickel, are seeing upticks in prices, buoyed by supply concerns and robust demand, driven by increased production of electric vehicles and the AI boom (read: AI, EV Power Copper Price to New Heights: ETFs to Tap).
Global oil prices have rebounded in recent months on OPEC+ production cuts and hopes of higher U.S. summer fuel demand. The Organization of the Petroleum Exporting Countries (“OPEC”) plus the cartel agreed to extend most of its deep oil production cuts into 2025 in the latest meeting held in early June. They also announced that the production cuts would be extended by another 2.2 million bpd by the end of September 2024.
We have profiled the ETFs below:
abrdn Physical Silver Shares ETF (SIVR) – Up 31%
abrdn Physical Silver Shares ETF tracks the performance of the price of silver less the Trust expenses. It has an AUM of $1.3 billion and trades in a good volume of around 1.4 million shares per day on average. SIVR has an expense ratio of 0.30% (read: Top ETF Stories of May to Watch in June).
United States Oil Fund (USO) – Up 22%
United States Oil Fund is the most popular ETF in the oil space, with an AUM of $1.2 billion and an average daily volume of 3 million shares. It seeks an average daily percentage change in USO’s net asset value for any period of 30 successive valuation days within plus/minus 10% of the average daily percentage change in the price of the Benchmark Oil Futures Contract over the same period. United States Oil Fund has an expense ratio of 0.60% (read: Will OPEC+ Output Cuts At All Boost Oil ETFs Ahead?).
United States Copper Index Fund (CPER) – Up 19.2%
United States Copper Index Fund seeks to track the performance of the SummerHaven Copper Index Total Return. The index is designed to reflect the performance of the investment returns from a portfolio of copper futures contracts on the COMEX exchange. United States Copper Index Fund has accumulated $218.2 million in its asset base and charges 97 bps in annual fees. It trades in an average volume of 244,000 shares a day and has a Zacks ETF Rank #3 (Hold) with a High risk outlook.
Invesco DB Agriculture Fund (DBA) – Up 16.6%
Invesco DB Agriculture Fund tracks the DBIQ Diversified Agriculture Index Excess Return, a rules-based index composed of futures contracts on some of the most liquid and widely traded agricultural commodities. It has key holdings in cocoa, coffee and live cattle with double-digit exposure each. Invesco DB Agriculture Fund charges 93 bps on an annual basis and trades in a volume of 686,000 shares a day. It has amassed $710.3 million in its asset base.
GraniteShares Gold Trust (BAR) – Up 15.7%
GraniteShares Gold Trust is designed to seek the performance of the price of gold. It provides an investment similar to an investment in gold through a Trust without having to open a metal account. It is among the lowest-cost gold ETFs on the market, having an expense ratio of 0.17%. GraniteShares Gold Trust has amassed $791.3 million in its asset base while trading in an average daily volume of 1.2 million shares.
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United States Oil ETF (USO): ETF Research Reports
abrdn Physical Silver Shares ETF (SIVR): ETF Research Reports
Invesco DB Agriculture ETF (DBA): ETF Research Reports
United States Copper ETF (CPER): ETF Research Reports
GraniteShares Gold Trust (BAR): ETF Research Reports