Commodities Poised For Comeback In Investor Portfolios: 'The Future Could Be Different,' Strategist Says (UPDATED)
Portfolio Pulse from Piero Cingari
Bank of America's commodities strategist, Francisco Blanch, predicts a bright future for commodities, citing reasons like thin inventories, ample spare capacity, sticky inflation, and a shift towards clean energy. The iShares Bloomberg Roll Select Commodity Strategy ETF (CMDY) is experiencing its strongest month since July 2023 after hitting a 2-year low in February 2024. Additionally, geopolitical tensions and a strategic shift towards gold reserves by emerging market economies are driving a resurgence in gold, with the SPDR Gold Trust (GLD) ETF seeing a rally despite conservative investor positioning.
March 26, 2024 | 4:29 pm
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The iShares Bloomberg Roll Select Commodity Strategy ETF (CMDY) is experiencing its strongest performance month since July 2023, indicating a positive outlook for commodities.
The strong performance of CMDY is directly linked to the positive outlook for commodities as outlined by Bank of America's commodities strategist. This resurgence is supported by factors like low inventories and energy transition spending, making it a significant indicator of the asset class's potential for handsome returns.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90
POSITIVE IMPACT
The SPDR Gold Trust (GLD) ETF is rallying, driven by strategic gold accumulation by central banks amidst geopolitical tensions, despite conservative investor positioning.
The rally in GLD is attributed to a strategic shift by emerging market economies towards gold reserves, driven by geopolitical tensions and the quest for diversified reserve portfolios. Despite conservative investor positioning, the trend of central banks accumulating gold supports a bullish outlook for GLD.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 85