For investors seeking momentum, iPath Bloomberg Cocoa Subindex Total Return is probably on radar now. The fund just hit a 52-week high and is up 30.7% from its 52-week low price of $21.17/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

NIB in Focus    

The ETN is designed to provide exposure to the Bloomberg Cocoa Subindex Total Return. The fund charges 70 bps in fees (see all Agricultural ETFs here).

Why the Move?

As per an article published on Reuters, cocoa prices should gain strength by the end of the year, improving after two successive annual declines. Constricting supplies are behind this bet. Prices are getting sweetened lately with the market gearing to a four-month high.

Dry weather is likely to hurt the crop in Ivory Coast, the world’s largest producer of cocoa beans. Plus, worries about diseases like the cacao swollen shoot virus hurting production pushed up prices in recent trading.

More Gains Ahead?

The product has a positive weighted alpha of 19.80. A positive weighted alpha hints at more gains. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.

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