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Chicago, IL – May 10, 2024 – Today, Zacks Investment Ideas feature highlights the iShares Silver Trust (SLV - Free Report) and the SPDR Gold Shares ETF (GLD - Free Report) , Natural Gas ETF (UNG - Free Report) .
Avoid Commodity Chop: Buy These 3 Commodity ETFs
From 1986 to 2010 Duquesne Capital Management averaged an annual return of 30%, dramatically outperforming the market and the hedge fund industry. Stanley Druckenmiller, who managed the Duquesne Capital Management portfolio (now a family office) attributes much of his success to his flexibility and willingness to trade across asset classes.
In a recent interview, Druckenmiller said, “The Fact that I can travel around five or six asset classes does a couple of things: 1.) It can point you in the right direction, and if you really believe something, you can make big gains there. 2.) As a macro investor, currencies and bonds trade 24 hours a day, are very liquid, and you can change your mind, which I have had to do a lot in my career because I’ve been wrong a lot in my career. 3.) (Trading across asset classes) gives you discipline, not to be playing around in an area that is dangerous.”Druckenmiller continued, “If you are an equity-only investor it’s your job to be in equities. If you have the latitude to say I’m just not going to play, it’s too complicated, you don’t play in them.”
As I mentioned in my recent piece,“Cracking the Code: 5 Reasons a Choppy Market Looms,” the smooth sailing bull market that investors have enjoyed in recent months may get more challenging to navigate due to factors such as geopolitical escalations, muddled Fed policy, and historical seasonality trend.
However, as Druckenmiller teaches, flexibility can be a huge advantage. With the advent of ETFs, investors do not need futures-enabled accounts to participate. Below are three non-equity markets investors should consider now:
Metals
Metals are back in play as inflation remains stubborn. Year-to-date, the iShares Silver Trust and the SPDR Gold Shares ETF are each up double digits and are outperforming the S&P 500 Index. GLD broke out to fresh all-time highs earlier this year, and SLV is on the brink of breaking out of a base dating back to 2020.
Natural Gas
TheNatural Gas ETF cleared its -50-day moving average for the first time since January – a sign of a possible trend change. Fundamental catalysts include heavy short interest, declining output, and higher demand forecasts.
Oil
The United States Oil Fund ETF is retracing after a solid move to start the year. However, geopolitical escalations and a dwindling U.S. Strategic Petroleum Reserve are just two factors that will likely put a floor under oil.
Bottom Line
When equity markets become complicated, other asset classes can provide investors with a refuge Commodity ETFs currently present favorable reward-to-risk opportunities.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: iShares Silver Trust, GLD and UNG
For Immediate Release
Chicago, IL – May 10, 2024 – Today, Zacks Investment Ideas feature highlights the iShares Silver Trust (SLV - Free Report) and the SPDR Gold Shares ETF (GLD - Free Report) , Natural Gas ETF (UNG - Free Report) .
Avoid Commodity Chop: Buy These 3 Commodity ETFs
From 1986 to 2010 Duquesne Capital Management averaged an annual return of 30%, dramatically outperforming the market and the hedge fund industry. Stanley Druckenmiller, who managed the Duquesne Capital Management portfolio (now a family office) attributes much of his success to his flexibility and willingness to trade across asset classes.
In a recent interview, Druckenmiller said, “The Fact that I can travel around five or six asset classes does a couple of things: 1.) It can point you in the right direction, and if you really believe something, you can make big gains there. 2.) As a macro investor, currencies and bonds trade 24 hours a day, are very liquid, and you can change your mind, which I have had to do a lot in my career because I’ve been wrong a lot in my career. 3.) (Trading across asset classes) gives you discipline, not to be playing around in an area that is dangerous.”Druckenmiller continued, “If you are an equity-only investor it’s your job to be in equities. If you have the latitude to say I’m just not going to play, it’s too complicated, you don’t play in them.”
As I mentioned in my recent piece,“Cracking the Code: 5 Reasons a Choppy Market Looms,” the smooth sailing bull market that investors have enjoyed in recent months may get more challenging to navigate due to factors such as geopolitical escalations, muddled Fed policy, and historical seasonality trend.
However, as Druckenmiller teaches, flexibility can be a huge advantage. With the advent of ETFs, investors do not need futures-enabled accounts to participate. Below are three non-equity markets investors should consider now:
Metals
Metals are back in play as inflation remains stubborn. Year-to-date, the iShares Silver Trust and the SPDR Gold Shares ETF are each up double digits and are outperforming the S&P 500 Index. GLD broke out to fresh all-time highs earlier this year, and SLV is on the brink of breaking out of a base dating back to 2020.
Natural Gas
TheNatural Gas ETF cleared its -50-day moving average for the first time since January – a sign of a possible trend change. Fundamental catalysts include heavy short interest, declining output, and higher demand forecasts.
Oil
The United States Oil Fund ETF is retracing after a solid move to start the year. However, geopolitical escalations and a dwindling U.S. Strategic Petroleum Reserve are just two factors that will likely put a floor under oil.
Bottom Line
When equity markets become complicated, other asset classes can provide investors with a refuge Commodity ETFs currently present favorable reward-to-risk opportunities.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.