Commodities can have a great role in your portfolio, however, they don’t seem to be providing a lot of downside protection for the stock component of your portfolio.
As I show you in the chart in the video of the movement of the S&P 500 versus the Deutsche Bank Commodity Tracking Index, you can see that when stocks have been moving lower, commodities have also been moving lower. When stocks have been moving higher, commodities have also been moving higher. This is a positive correlation between these two asset groups………………………………………..Full Article: Source

Over the last month, I’ve shown you how China’s economy has seen a resurgence in commodities imports like copper, iron ore, uranium, and coal. China is the largest importer of industrial commodities in the world… So when its demand picks up, it’s bullish for the sector.
Platinum is a “dual purpose” metal. It’s used in jewelry… and it’s considered a “store of wealth,” so it serves as a precious metal like gold. But it’s also an industrial metal. It is used to make catalytic converters – which reduce a vehicle’s pollutants – and as a catalyst for refining gasoline and diesel fuel. Those two sectors account for 57% of the platinum produced per year. And demand is soaring………………………………………….Full Article: Source

Barclays is halting agricultural trading with hedge funds in a move to burnish its reputation amid a major overhaul, but will still market index-linked investment products in the sector.
The British bank is among several financial institutions to have come under fire for speculating on grain and other agriculture products, which critics say has pushed up food prices and fuelled unrest in some poor countries………………………………………..Full Article: Source

Jim Rogers has never been shy about vocalizing his love of precious metals. Though he has some cautionary sentiment about short-term gold prices given their 12-year bull run, the legendary investor still remains optimistic about the long-term future of both silver and gold.
Rogers feels that investors should be loading up on silver and gold coins right now as he notes that they have surged in popularity and that mints have been consistently selling out of silver coins because investors are worried about the future………………………………………..Full Article: Source

Hedge funds increased bullish commodity bets for the fourth straight week and became the most bullish on copper since December as signs of faster growth in the U.S. and China fueled the best start to the year since 2005.
Speculators boosted net-long positions across 18 U.S. futures and options in the week ended Feb. 5 by 11 percent to 885,655 contracts, marking the longest stretch of gains in more than six months, U.S. Commodity Futures Trading Commission data show. Traders lifted bullish wagers on everything from copper to platinum, corn and soybeans………………………………………..Full Article: Source

Diverse price performance was the feature across the global commodity markets last week - covering energy products, base and precious metals as well as agriculture. Brent crude continued to rise with the prompt contract rates crossing levels last seen eight months ago, spurred by a combination of improving macroeconomic sentiment and intensification of geopolitical concerns.
The metals complex was rather diverse with most base metals registering a price fall except zinc that was up 1.2 per cent and copper nearly unchanged, while precious metals generally retained their upward trajectory with platinum (up 1.6 per cent) the real performer. Gold was unchanged week on week, while silver edged slightly higher………………………………………..Full Article: Source

As the stock market nears all-time highs, a lot of investors are starting to look around for ways to diversify their portfolios in case the stock market reverses. One asset class that has become increasingly popular for diversification is commodities.
Though investing in commodities used to require using futures and trading on margin, with the introduction of new commodity-based exchange-traded funds and exchange-traded notes, buying and holding commodities has never been easier. The question is … does buying commodities to add a layer of diversification and protection to your portfolio actually work?……………………………………….Full Article: Source

What do you think is the best investment this year? MPO Research Group asked respondents to predict which investments will yield the best returns in 2013 and found that opinion is divided. Gold and commodities earn the most support as the best investment this year: 27.8% of respondents choose this option.
Cash is also popular, selected as the best investment by 23.4% of respondents. Real estate is preferred by 21.3% of respondents and stocks by 20.2%. Bonds are the least popular investment, preferred by only 7.3% of respondents. Expectations for gold and commodities show an inverse relationship with expectations for one’s personal financial future. 51.9% of those who expect a significant decline in their personal finances expect that gold and commodities will be a good investment this year. (Press Release)

Anyone who looks at precious metals when investing in 2013 will likely turn to gold and silver, maybe even platinum. But there is another precious metal that is often overlooked, and should not be: palladium.
Palladium is mainly used in catalytic converters on gasoline-powered vehicles to limit the pollution these vehicles emit, just as its sister metal, platinum, is used in a similar fashion for diesel-powered vehicles………………………………………..Full Article: Source

In futures-based commodities investing, picking the right ETP is harder than it looks. A lot of exchange-traded products try to beat the market, but it’s only in commodities that the more active products are often more popular than their plain-vanilla counterparts.
The most popular basket commodities fund, the PowerShares DB Commodity Index Tracking Fund (DBC), has over $7 billion in assets under management — more than three times the assets of the iPath Dow Jones-UBS Commodity Total Return ETN (DJP) and nearly six times the assets of the iShares S&P GSCI Commodity-Indexed Trust (GSG)………………………………………..Full Article: Source

Jim Rogers, who co-founded the Quantum Fund with George Soros in the 1970s, is exploring the world for investments in water technology. “There will be wars east of the Red Sea over oil and wars west of the Red Sea over water,” Rogers, 70, said in an interview yesterday before giving a speech to the CFA Society of Atlanta.
Rogers, who is chairman of Rogers Holdings in Singapore where he lives with his wife and two young daughters, said he isn’t interested in owning lakes, reservoirs or other sources of water that could be confiscated by governments in times of turmoil. He said he’s looking for technologies that can help free countries from dependency on outside water sources. One stock he holds is Singapore-based HyFlux Ltd, which makes and installs water purification, treatment and recycling systems………………………………………..Full Article: Source

Pension funds and other institutions are retreating from popular investments linked to commodities after finding they did little to protect their portfolios against inflation risk and the unpredictable returns of stocks.
Investors have yanked nearly $10 billion from tradable indexes tied to energy, food, metals and other commodities after two years of record outflows. That leaves about $133 billion, said Kevin Norrish, a managing director at Barclays PLC……………………………………….Full Article: Source

Commodities hedge funds surrendered at least 20 per cent of their assets last year after investors pulled out large sums following the sector’s worst annual performance in more than a decade, according to fund managers and investors.
The average commodity hedge fund lost 3.7 per cent in 2012, according to a closely watched index compiled by Newedge, the biggest decline since the yardstick was created more than a decade ago and substantially worse than the 1.4 per cent loss of 2011………………………………………..Full Article: Source

Global investment in commodity-based exchange-traded products, structured notes and index swaps totalled approximately USD100 billion in 2006. Six years later, this number had risen to a record high of USD415bn. This is largely explained by the fact that commodities are now standard components of strategic asset allocation as they generate equity-like returns in the long run, act as risk-diversifiers, and serve as an inflation-hedge.
However, given the practical, regulatory and ethical difficulties of investing in physical commodities, the challenge of choosing from a bewildering multitude of index products, and the recurring bull and bear markets in commodities, “the decision to invest in a diversified commodity hedge fund manager seems almost a no-brainer” (Source: Barclays Capital - Hedge Fund Pulse, September 2011)………………………………………..Full Article: Source

To lose money one year may be regarded as a misfortune. But for two years in a row now commodity hedge funds have not only lost money, but underperformed even the most basic index investments in raw materials. To some of their investors – typically large pension funds or insurers – that looks like carelessness.
Some pension funds, therefore, have begun to lose enthusiasm for the hedge fund sector, fund managers report………………………………………..Full Article: Source

Commodities are becoming an attractive portfolio component for investors despite the slump seen in 2012, said Bank of America Merrill Lynch in a report.
Commodities may have underperformed other assets on a risk-adjusted basis in recent years and have suffered from a period of high correlation to better performing risk assets such as equities, the report stated………………………………………..Full Article: Source

The two biggest pension funds in the Netherlands plan to maintain investment in commodities even after their latest quarterly reports showed commodities as their worst performing asset class and a big U.S. fund halved its exposure.
Dutch funds ABP, for state employees, and Pensioenfonds Zorg en Welzijn PFZW for health and medical care workers, along with Californian state pension fund CalPERS, were among a handful of big pension funds that invested in commodity derivatives as an alternative to stocks and bonds in the middle of last decade……………………………………..Full Article: Source

Fund managers’ ardour for gold is cooling as the threat of a catastrophic event in the world economy recedes and expectations of a gradual economic recovery grow, fuelling demand for other assets.
Gold prices have traded in a broad sideways channel between $1,525 and $1,800 an ounce since falling back from a record $1,920.30 in September 2011, and have repeatedly failed to break back above $1,700 this year……………………………………..Full Article: Source

Two developments in the last week are turning the heat up on oil companies: HSBC released an analysis finding oil majors at significant risk from “unburnable” reserves, and a pension fund has agreed to consider divestment from fossil-fuel companies in response to NGO pressure. This signals growing concern among conventional investors that climate change could be creating a “carbon bubble” in equity markets.
Concerns around carbon dioxide emissions are growing as climate science grows ever firmer on CO2’s contribution to climate change. International research bodies – including the International Energy Agency, or IEA – model three possible scenarios for the future in terms of the number of degrees Celsius of average global warming by 2050……………………………………..Full Article: Source

Many financial institutions and multinational organizations view speculating on food commodities as a dangerous game and a contributor to global hunger. Despite its bruised reputation, Deutsche Bank is leaping back into the business.
Nikolaus von Bomhard, CEO of the reinsuring giant Munich Re, feels that speculation in food commodities isn’t entirely harmless. “There is a limit at which additional liquidity no longer creates additional value,” he says. Munich Re doesn’t invest in food commodities, nor does it offer any derivatives to hedge against risk in food production………………………………………..Full Article: Source

Rarely is Deutsche Bank’s press conference as colorful. But Thursday morning it was barely possible to make it past the rabble of protestors chanting songs about world food supply and rising food prices. So Deutsche had some explaining to do as to why it’s once again selling financial products based on agricultural commodities.
Its return, after barely a year, announced by Co-Chief Executive Juergen Fitschen earlier this month at Germany’s biggest agricultural fair Gruene Woche, or “Green Week,” comes at a time when the bank is making tremendous efforts to repair its tarnished public image. And its two new co-chiefs, who took the helm in June, unrelentlessly advocate the bank’s need for “cultural change.”……………………………………….Full Article: Source

Commodity stocks in the food, timber and infrastructure sectors look attractive for 2013, Mike Underhill, founder and chief investment officer of Capital Innovations, told CNBC. “Commodities have always been an interesting asset class. But playing commodity stocks in a portfolio that’s diversified prudently is a way to gain capital appreciation with hard asset ownership as an inflation hedge,” Underhill said.
He likes stocks with exposure to food, fuel and forests. All three resources will be in demand as the global population only continues to grow………………………………………..Full Article: Source

The amount of investment demand will be one of the key variables for silver in the long term, said CPM Group while releasing the 2013 update to its Silver Long-Term Outlook market study.
The report provides an analysis of global mine production, secondary supply, fabrication and investment demand, inventory levels and prices. The report looks out through 2022 and is an update to a 2011 report………………………………………..Full Article: Source

For the second time in less than two years, the United States is facing a debt-ceiling calamity. In this installment of The Commodity Investor, we will discuss the debt ceiling and then examine what impact, if any, it will have on commodity markets.
The US, just like any other country in the world, issues debt in order to finance its existing operations and meet its current legal obligations. These legal obligations include paying back holders of its debt (in the form of bonds issued by the treasury department), paying for services such as Social Security and Medicaid, issuing tax refunds, paying government employee salaries and more………………………………………..Full Article: Source

Gold has been coveted for millennia because of its beauty, rarity and virtual indestructibility. In the current economic climate gold continues to have merit as a store of wealth.
Gold as an investment has grown in popularity in recent years, partly because of the risks posed to our modern global financial and economic systems – it is often seen as a safe-haven in times of crisis. The price of gold bullion fluctuated between $1,500 and $1,800 during 2012………………………………………..Full Article: Source

Commodities are among the most skittish investments. Not only do they react to global economic forces, they can seesaw with supply and demand, China’s voracious appetite for raw materials and the weather.
Since commodities are tangible things that are mined or grown, they are hard to hold and often bought through futures contracts, which have their own peculiarities. Yet what is undeniable about commodities is that they are usually a good tracker of broad economic growth, inflation among producer prices and they run inversely to the dollar’s decline. You should have a piece of them in your portfolio, but you have to be careful about how you hold them………………………………………..Full Article: Source

Morgan Stanley, in its newly released Commodity Manual, just delivered good news for anyone investing in commodities in 2013. The report gives a bullish outlook in 2013 and 2014 for eight of 14 commodities it evaluated. Estimated two-year gains range from 3.05% to 17.3%.
Money Morning Global Resources Specialist Peter Krauth agrees most commodities will perform well. In fact, he projects even higher growth than Morgan Stanley’s outlook. “With central banks on their virtually uninterrupted fiat money-printing spree bound to continue for the next few years, hard assets remain a great place to be,” Krauth says. “That being said, some commodities will undoubtedly do better than others.”……………………………………….Full Article: Source

Commodity markets are picking up. If you want to diversity your investment portfolio, you’d better turn to commodities. But when you do that, take an informed decision after having a thorough knowledge on commodities, experts advised investors.
They were giving a bird’s eye view of the commodities market, with a focus on agriculture commodities and gold, at a stakeholder awareness and education seminar on the subject………………………………………..Full Article: Source

It might seem churlish to complain about the mediocre returns delivered by commodities during 2012 given the consistently strong performance of this asset class over the past decade. Still, this is not what we were told to expect by bulls who sold investors the idea of the commodities “super cycle” - they promised us it would last a great deal longer.
Commodities investors would benefit from a unique confluence of positive factors, those bulls predicted, with huge demand from the industrialisation and urbanisation of the BRIC (Brazil, Russia, India and China) economies combined with two decades of under-investment holding back supply………………………………………..Full Article: Source

Hedge funds raised bullish commodity wagers by the most since November as a jump in U.S. housing starts and the first acceleration in Chinese growth since 2010 drove prices to a three-month high.
Speculators increased net-long positions across 18 futures and options by 4.3 percent to 682,521 contracts in the week ended Jan. 15, the biggest gain since Nov. 27, U.S. Commodity Futures Trading Commission data show………………………………………..Full Article: Source

Deutsche Bank AG (DBK) will continue to provide agricultural-investment products after Germany’s largest bank concluded that they’re not the cause of rising prices for farm commodities.
“There was no evidence that speculation was responsible for price developments,” Juergen Fitschen, the company’s co- chief executive officer, said at a press conference in Berlin today. “It can contribute to volatility under certain conditions but there are also other reasons for volatility.”……………………………………….Full Article: Source

For the global commodity market, the good news last week was that the OECD composite leading indicators point to stabilising economic growth in most major economies even as the leading indicators for the US continue to point to economic growth firming, while in China and India the signs of a turning point are more marked than was the case a month ago.
This improving global economic environment should be positive for growth-driven commodities such as base metals and energy products………………………………………..Full Article: Source

Grains represent agriculture investors’ better bet for most of 2013, but it is soft commodities, in particular cotton and sugar, which will end the year on the up, Macquarie said.
The bank, in a major crop report, rated corn as its “favourite in the short-term” in agricultural commodities, forecasting a return in prices to an average of $8.50 a bushel in the April-to-June quarter, well above the level that futures are pricing in………………………………………..Full Article: Source

Goldman Sachs Group Inc on Wednesday said its commodities revenue suffered in the final quarter of 2012, while JPMorgan Chase & Co reported a plunge in trading risk from a year ago.
Analysts said falling oil, metals and grains prices as well as higher trading uncertainties as the United States appeared headed for a fiscal crisis toward year-end created a weaker trading environment for commodities. Goldman Sachs, Wall Street’s leading investment bank, said its value-at-risk (VaR) in commodities stood at $20 million in the fourth quarter, down from $22 million in the third quarter and $26 million a year ago………………………………………..Full Article: Source

Agricultural commodities may recapture some of their investor appeal lost during the late-2012 sell-off, Societe Generale said, rating Kansas wheat and lean hogs as its top bets in the complex.
Funds have quit positions in many commodity types, partly thanks to a rush back into equities, towards which investors have their most bullish positioning since February 2011, according to a Bank of America Merrill Lynch survey………………………………………..Full Article: Source

The price of gold was on the rise today after Germany’s decision to repatriate its bullion. We explain how you can profit. Gold enthusiasts were bouyed today by the decision of Germany’s central bank to pull its gold reserves out of Paris and New York.
It follows warnings from the country’s Court of Auditors that bullion held abroad had “never been verified physically” and was not under proper control………………………………………..Full Article: Source

Gold bugs are never the kind of people to take any piece of news at its simple face value. There’s always got to be some sort of feverishly dark motive behind China’s latest change to its bullion sales regime. The Viennese authorities have surely got to have had a reason for that massive issue of memorial gold coins?
And why is a London shopping mall selling 250 gram gold bars from a vending machine at £11,000 a pop? Damn you, Bilderberg, what are you up to? So the news that Germany has decided to bring €27bn worth of physical gold back to Frankfurt, from its normal resting place in various parts of the globe, is more reason for excitement. What evil thing does the Bundesbank know about New York, the home of some 1500 tonnes of German gold, that it isn’t telling us? ……………………………………….Full Article: Source

Investment demand should continue to support gold prices in 2013, said a metals consultancy firm on Wednesday. Thomson Reuters GFMS said the reasons that have supported gold prices in its current bull run remain intact. “Although there is now growing speculation around the structure and longevity of the Fed’s QE (quantitative easing) program, policies of ultra-low interest rates across the Western economies will persist in 2013.
This will continue to support investor interest in gold in the absence of low risk investments that can offer acceptable yields,” said Philip Klapwijk, global head of metals analytics at Thomson Reuters GFMS………………………………………..Full Article: Source

Are you thinking of investing in gold, silver, platinum or palladium? What’s the best way to gain exposure to precious metals? Thinking of jumping on the precious metals bandwagon?
The share of Millionaires interested in investing in precious metals more than doubled in the last two years, from 6 percent at year-end 2010 to 15 percent at the end of 2012, according to the latest research from Spectrem’s Millionaire Corner………………………………………..Full Article: Source

Global commodities merchant Castleton Commodities International LLC, owned in part by billionaire investors Glenn Dubin and Paul Tudor Jones, said on Tuesday it has acquired oil and gas assets in Colorado and Utah in a bid to build out its physical natural gas business.
The firm acquired 180 oil and gas wells, 150,000 net acres in mineral leases, a gas processing facility and a 262-mile gas gathering system from Houston-based Patara Oil & Gas, it said in a press release………………………………………..Full Article: Source

This will be a make-or-break year for this commodity, as markets flirt with pre-recession highs and investors slowly move into “risk on” purchasing. Faber’s bullishness on the metal will certainly be tested in the coming months.
Marc Faber, author of the famed “Gloom, Boom & Doom Report,” is a respected name in the investing world. If ever there was a perma-bear, it would be Faber. He tends to focus on areas of the world that he sees problems in and allow that information to influence his investing decisions. But no matter what segment Faber has an eye on, his focus always circles back to one asset: gold. The precious metal has long been an important part of his holdings, and he has not been shy about vocalizing his love for the commodity………………………………………..Full Article: Source

Since 2008, one of the topics I am frequently asked about is commodity investing in regards to both individual commodities and index investing. In 2003 investment in commodities was estimated at $15 billion and is now north of $200 billion.
The rise in popularity is mostly attributed to two reasons. The first being the risk diversification benefits of adding commodities to a portfolio and the second being a hedge against inflation………………………………………..Full Article: Source

Drought, recession and political upheaval rocked commodity markets and confounded price forecasters last year, but at least some got it right, even if guess-work sometimes overtook mathematical calculations.
At the start of 2012, no one could have foreseen the drought that decimated a historically high planted area for U.S. corn, or deadly violence in the Middle East and in South Africa’s mining sector, or the extent of China’s economic slowdown………………………………………..Full Article: Source

It is pretty obvious that there is a lot of liquidity in the system, with the Fed`s loose monetary policy, extremely low interest rates, and traders in all out “Risk On” mode with regard to their two favorite funding currency crosses in the EUR/USD and USD/JPY.
Traders are banging every asset class except for the Metals into the close, pushing asset classes up overnight with the futures contracts on a regular basis, and it is definitely a “Risk On” environment in the markets………………………………………..Full Article: Source

Investment in clean energy projects dipped 11 per cent last year, according to new figures from Bloomberg New Energy Finance (BNEF), which confirmed the $268.7bn invested still made 2012 the second most successful year on record for the global clean energy sector.
The analyst firm also revealed the rapid expansion of China’s clean energy market continued last year, with investment rising 20 per cent to $67.7bn, allowing China to re-take the top spot from the US………………………………………..Full Article: Source

There are several ways to invest in gold - bullion funds, leveraged funds, gold mining company shares, and others. The question is: Which form of gold investment provides the best risk mitigation if there is a war or major crisis?
The risk of global instability is real. In my Instablog, I identified the greatest risks and reasons for a crisis in the Middle East or Far East, as well as a few assumptions and disclaimers. Contrary to the World is Our Classroom saying: “I’ve learned that most of the things that I worry about never happen,” worrying about portfolio-impacting events can lead to loss-mitigating results………………………………………..Full Article: Source

Hedge funds cut bullish commodity wagers to the lowest since June before prices rallied to a two- month high on signs of a rebound in Chinese economic growth.
Speculators trimmed net-long positions across 18 futures and options by 5.4 percent to 654,443 contracts in the week ended Jan. 8, the lowest since June 19, U.S. Commodity Futures Trading Commission data show. Wagers on a corn rally dropped for a fifth week before a reduction in U.S. stockpile data sparked the biggest jump in prices in five months. Gold holdings fell to the lowest since August as the metal snapped a six-week slump………………………………………..Full Article: Source

New research from The Real Asset Company finds that Q1 is the best time to watch the gold price make gains from month to month, which suggests the end of December or right at the beginning of the year are the times to get on the gold investment band-wagon. Not “if” but “when” to invest in gold.
According to World Gold Council data, it is estimated that in the UK alone 600,000 people will be looking to invest in gold, for the first time, over the next 12 months. So we thought we would try and give some helpful advice as to what to look out for in gold price action in 2013, based on the last 12 years………………………………………..Full Article: Source

Over the last two weeks, I suggested that the silver futures were headed to the 31.60 region, to be followed by a decline which should ideally target at least the 28.67 region. While we topped at 31.53, and then saw a nice decline, which bottomed at 29.12 for a 2.39 decline, and a nice short trade for those that took it, we still came up 45 cents short of my minimal target.
But, before I discuss the next market moves in silver, and whether it will still reach the lower levels cited in the last article, there is a “fundamental” issue I need to address once again, and that is the so-called “manipulation” perspective………………………………………..Full Article: Source

It is impossible to write the history of hedge funds or American investors without including George Soros. Though Soros did not invent the hedge fund, he was among a very select group to show how a well-run fund employing significant leverage could generate outsized returns for prolonged periods of time.
Due to a particular combination of success, aggression and willingness to speak to the press, Soros found his name tied to two major financial events of the 1990s and he became for many the epitome of a hedge fund manager. According to the most recent Forbes numbers, Soros is the 15th-richest person in the world, with a $19 billion net worth………………………………………..Full Article: Source