The Ultimate Guide To Resource-Specific “Third Generation” Commodity ETPs
For retail investors, ETFs have leveled the playing field and opened all sorts of alternative asset classes and strategies to the mainstream. One asset class that has surged in popularity has been commodity and natural resource investing. As such, the number of ETFs in this area has exploded and now represents one of the largest fund categories around. Currently, there are over 110 different funds that track futures and hard asset prices [see Free Report: How To Pick The Right ETF Every Time]. However, early products in the space, like the United States Natural Gas , suffer from a potentially big problem in the concept of contango. Contango can lead to underperformance and even losses in an ETF. By definition, contango occurs when near month future contracts are cheaper than those expiring further into the future. ETFs based only on current prices–meaning they own the future contract for the current month–lose money [...] Click here to read the original article on ETFdb.com. Related Posts: Teucrium Debuts New Agriculture ETF (TAGS) June ETF Roundup: Launches and Filings First The CORN ETF, Now Five More Funds New Metals ETF (USMI) Debuts USCF Debuts Agriculture ETF (USAG)
For retail investors, ETFs have leveled the playing field and opened all sorts of alternative asset classes and strategies to the mainstream. One asset class that has surged in popularity has been commodity and natural resource investing. As such, the number of ETFs in this area has exploded and now represents one of the largest fund categories around. Currently, there are over 110 different funds that track futures and hard asset prices [see Free Report: How To Pick The Right ETF Every Time]. However, early products in the space, like the United States Natural Gas , suffer from a potentially big problem in the concept of contango. Contango can lead to underperformance and even losses in an ETF. By definition, contango occurs when near month future contracts are cheaper than those expiring further into the future. ETFs based only on current prices–meaning they own the future contract for the current month–lose money [...]

Click here to read the original article on ETFdb.com.

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