| Investing in commodities has grown more popular in last few years and today they find a place in any well-diversified portfolio. Exchange-traded funds (ETFs) offer multiple benefits like diversification, professional money management of a mutual fund, and real-time trading of a stock listed on an exchange. Commodity ETFs provide an efficient mode of investing and trading commodities and come in three flavors:
Physical-based ETFs: Such funds invest directly in physical commodities like gold, crude oil, or grains, while bearing the additional cost of transport, storage, and security. Equity-based ETFs: These invest in stocks of commodity-based companies, such as shares in oil companies like Royal Dutch Shell (RDS-A). Such ETFs avoid the hassles of commodity storage and operational issues. However, they carry stock-specific and overall market risks...............................................Full Article: Source
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