50% OFF
MarketBeat All Access
Get 30 days free. Save 50% your first year.
  •  days
  •  Hours
  •  Minutes
  •  Seconds
×
S&P 500   3,663.52 (+0.23%)
DOW   29,280.69 (+0.07%)
QQQ   278.20 (+1.40%)
AAPL   152.40 (+1.08%)
MSFT   238.77 (+0.56%)
META   137.76 (+1.02%)
GOOGL   98.89 (+0.73%)
AMZN   115.50 (+0.30%)
TSLA   287.10 (+4.02%)
NVDA   125.97 (+3.02%)
NIO   17.76 (+0.79%)
BABA   79.41 (+0.63%)
AMD   68.12 (+2.75%)
T   15.92 (+1.60%)
MU   50.00 (+2.29%)
CGC   2.88 (+5.11%)
F   12.11 (+1.00%)
GE   64.92 (+0.89%)
DIS   98.23 (+0.11%)
AMC   7.30 (+6.88%)
PYPL   86.72 (+2.92%)
PFE   44.24 (+0.94%)
NFLX   227.44 (+1.50%)
S&P 500   3,663.52 (+0.23%)
DOW   29,280.69 (+0.07%)
QQQ   278.20 (+1.40%)
AAPL   152.40 (+1.08%)
MSFT   238.77 (+0.56%)
META   137.76 (+1.02%)
GOOGL   98.89 (+0.73%)
AMZN   115.50 (+0.30%)
TSLA   287.10 (+4.02%)
NVDA   125.97 (+3.02%)
NIO   17.76 (+0.79%)
BABA   79.41 (+0.63%)
AMD   68.12 (+2.75%)
T   15.92 (+1.60%)
MU   50.00 (+2.29%)
CGC   2.88 (+5.11%)
F   12.11 (+1.00%)
GE   64.92 (+0.89%)
DIS   98.23 (+0.11%)
AMC   7.30 (+6.88%)
PYPL   86.72 (+2.92%)
PFE   44.24 (+0.94%)
NFLX   227.44 (+1.50%)
S&P 500   3,663.52 (+0.23%)
DOW   29,280.69 (+0.07%)
QQQ   278.20 (+1.40%)
AAPL   152.40 (+1.08%)
MSFT   238.77 (+0.56%)
META   137.76 (+1.02%)
GOOGL   98.89 (+0.73%)
AMZN   115.50 (+0.30%)
TSLA   287.10 (+4.02%)
NVDA   125.97 (+3.02%)
NIO   17.76 (+0.79%)
BABA   79.41 (+0.63%)
AMD   68.12 (+2.75%)
T   15.92 (+1.60%)
MU   50.00 (+2.29%)
CGC   2.88 (+5.11%)
F   12.11 (+1.00%)
GE   64.92 (+0.89%)
DIS   98.23 (+0.11%)
AMC   7.30 (+6.88%)
PYPL   86.72 (+2.92%)
PFE   44.24 (+0.94%)
NFLX   227.44 (+1.50%)
S&P 500   3,663.52 (+0.23%)
DOW   29,280.69 (+0.07%)
QQQ   278.20 (+1.40%)
AAPL   152.40 (+1.08%)
MSFT   238.77 (+0.56%)
META   137.76 (+1.02%)
GOOGL   98.89 (+0.73%)
AMZN   115.50 (+0.30%)
TSLA   287.10 (+4.02%)
NVDA   125.97 (+3.02%)
NIO   17.76 (+0.79%)
BABA   79.41 (+0.63%)
AMD   68.12 (+2.75%)
T   15.92 (+1.60%)
MU   50.00 (+2.29%)
CGC   2.88 (+5.11%)
F   12.11 (+1.00%)
GE   64.92 (+0.89%)
DIS   98.23 (+0.11%)
AMC   7.30 (+6.88%)
PYPL   86.72 (+2.92%)
PFE   44.24 (+0.94%)
NFLX   227.44 (+1.50%)

7 Commodities ETFs to Help Build a Hedge Against Inflation

7 Commodities ETFs to Help Build a Hedge Against Inflation

Commodities are a broad category that covers agricultural products like wheat, corn, and soybeans. It also includes oil and derivative products such as gasoline, natural gas, and diesel fuel.

However, investing in commodities also covers precious metals such as gold and silver as well as base metals like copper and aluminum. And more recently, this sector includes items like lithium that will be needed in many of the emerging sectors of our economy.

Commodities trading is frequently done by trading contracts on the futures market. And it's not for faint-of-heart investors. Prices are volatile and can change quickly due to macroeconomic events.

However, at certain times, particularly in times of high inflation, commodities outperform the broader market. A practical alternative for individual investors looking to profit from commodities is to invest in exchange-traded funds (ETFs). These funds give investors exposure to this sector while reducing the risk that comes from investing in any single commodity.

Here are seven ETFs that you can buy to help build a hedge against inflation.

Quick Links

  1. SPDR Gold Shares
  2. iShares Silver Trust
  3. Aberdeen Standard Physical Platinum Shares ETF
  4. Invesco DB Commodity Index Tracking Fund
  5. United States 12 Month Oil Fund
  6. Teucrium Corn Fund
  7. Teucrium Wheat Fund

#1 - SPDR Gold Shares (NYSEARCA:GLD)

SPDR Gold Shares logo

You don’t need to be a “gold bug” to appreciate the value of having exposure to gold in your portfolio. Many investors choose to buy and store physical gold in the form of bars or coins. But it has its limitations, particularly in terms of liquidity. That’s why it can make sense to invest in the SPDR Gold Shares ETF (NYSEARCA:GLD). This ETF is up 42% in the last five years which is nearly double the increase in the spot price of gold over the same time period. Investors also benefit from a low expense ratio of just 0.40%.

Critics would say that rising interest rates will strengthen the U.S. dollar which historically acts as a headwind for gold prices. However, if investors are looking for an investment that is a proven inflation hedge, having exposure to gold should be part of a sound investment strategy. The smart money seems to agree as institutional buying spiked sharply in the first quarter of 2022.

About SPDR Gold Shares

SPDR Gold Trust (the Trust) is an investment trust. The investment objective of the Trust is for the Shares to reflect the performance of the price of gold bullion, less the Trust's expenses. The Trust's business activity is the investment of gold. The Trust creates and redeems Shares from time to time, but in one or more Baskets (a Basket equals a block of 100,000 Shares). Read More 
Current Price
$152.30
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#2 - iShares Silver Trust (NYSEARCA:SLV)

iShares Silver Trust logo

If you’re considering investing in precious metals, silver and gold go together like peanut butter and jelly. And some investors prefer silver because they point to its use in a range of applications. And currently, that includes its demand for semiconductors. Like gold, investors can choose to buy silver in its physical form. However, like gold that comes with limitations.

A popular ETF for investors to consider is the iShares Silver Trust (NYSEARCA:SLV). This is the largest physically-backed silver ETF in operation. It currently has just under $12 billion ($11.93 billion) assets under management (AUM). And the only holding of the fund is silver. Over the last five years, the per-share price of the fund is up 22%. The fund has an expense ratio of 0.50%.

About iShares Silver Trust

iShares Silver Trust (the Trust) owns silver transferred to the Trust in exchange for shares issued by the Trust. The Trust's each share represents a fractional undivided beneficial interest in its net assets. The assets of the Trust consist of silver held by the Trust's custodian on behalf of the Trust. Read More 
Current Price
$17.19
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#3 - Aberdeen Standard Physical Platinum Shares ETF (NYSEARCA:PPLT)

Aberdeen Standard Physical Platinum Shares ETF logo

We’ve got an additional precious metals ETF to recommend. The Aberdeen Standard Physical Platinum Shares ETF (NYSEARCA:PPLT) is a way to get exposure to precious metals without investing in gold or silver. Like silver, platinum has applications in many industries. Two such industries that investors should keep in mind are medical equipment and clean energy.  For example, platinum-based fuel cells can be a more cost-effective, clean, and reliable alternative to diesel.

But this is a long-term play. The fund is flat for the year and it’s also flat when you widen out to view performance over the last five years. Currently, the fund has approximately $583 million of assets under management with an expense ratio of 0.60%.

About Aberdeen Standard Physical Platinum Shares ETF

Current Price
$79.77
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#4 - Invesco DB Commodity Index Tracking Fund (NYSEARCA:DBC)

Invesco DB Commodity Index Tracking Fund logo

One of the benefits of investing in ETFs is that they can give investors exposure to a variety of components within a sector without giving too much exposure to any one component. That’s the reason to consider the Invesco DB Commodity Index Tracking Fund (NYSEARCA:DBC). This fund tracks a basket of commodities ranging from agricultural products, oil, precious metals, and base metals. The fund has $5 billion of assets under management.

That being said, investors should be aware that the fund does use futures contracts to acquire assets. Futures contracts are derivative investments that allow the buyer to lock in a predetermined price (i.e. a contract) to buy a particular commodity at a specific date in the future. This makes the fund even more volatile than commodities can be. It also carries a relatively high expense ratio of 0.87%.

About Invesco DB Commodity Index Tracking Fund

Deutsche Bank is a leading global investment bank with a strong and profitable private clients franchise. A leader in Germany and Europe, the bank is continuously growing in North America, Asia and key emerging markets. Deutsche Bank offers unparalleled financial services in countries throughout the world. Read More 
Current Price
$23.90
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#5 - United States 12 Month Oil Fund (NYSEARCA:USL)

United States 12 Month Oil Fund logo

In times of high inflation, investors flee to energy stocks. The world needs energy in all its forms and that makes energy stocks a defensive play. That being said, this can be a volatile sector and investors have many ways to get exposure to energy markets. The United States 12 Month Oil Fund (NYSEARCA:USL) is a reasonable way to consider profiting from a commodity that will be in demand even as the nation builds a clean energy infrastructure.

The fund’s goal is to reflect the changes in the price of Brent Crude Oil in percentage terms. The fund is up 61% in 2022 and 168% over the last five years. However, it does have an expense ratio of 0.86% which can be considered a bit high.

About United States 12 Month Oil Fund

Current Price
$32.54
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#6 - Teucrium Corn Fund (NYSEARCA:CORN)

Teucrium Corn Fund logo

Corn remains one of the agricultural products that is in high demand. In 2020, a record 97 million acres of corn were planted. And with reports of the likelihood of food shortages occurring across the world in 2022, it’s likely there will be a disparity between supply and demand. This will mean that the price of corn is likely to become a profitable trade.

If you’re looking for a way to invest in this commodity without taking on the risk and the guesswork involved with futures contracts, there is the Teucrium Corn Fund (NYSEARCA:CORN). The CORN fund is up 32% in 2022 and is likely to go much higher. The fund has $295 million of assets under management and carries an expense ratio of 1.0%. In six out of the last eight quarters, institutional buying has outweighed institutional selling which suggests that the smart money believes the price of corn is also going higher.

About Teucrium Corn Fund

Teucrium Corn Fund (the Fund) is a commodity pool that is a series of Teucrium Commodity Trust (Trust), a Delaware statutory trust. It will issue common units representing fractional undivided beneficial interests in such Fund, called Shares. The investment objective of the Fund is to have the daily changes in percentage terms of the shares net asset value reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for three futures contracts for corn (Corn Futures Contracts) that are traded on the Chicago Board of Trade (CBOT), including the second to expire CBOT Corn Futures Contract, weighted 35%, the third-to-expire CBOT Corn Futures Contract, weighted 30%, and the CBOT Corn Futures Contract, weighted 35%. Read More 
Current Price
$26.84
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A




#7 - Teucrium Wheat Fund (NYSEARCA:WEAT)

Teucrium Wheat Fund logo

Ever since the Russian invasion of Ukraine, investors and consumers have been warned about the coming supply-demand imbalance in wheat. But aside from buying futures contracts, it can be difficult for retail investors to have an easy way to invest in wheat.

The Teucrium Wheat Fund (NYSEARCA:WEAT) is a pure-play ETF that gives investors exposure to wheat futures contracts. The fund uses a laddered strategy that weights its holdings across three futures contracts that are tied to the Chicago Board of Trades (CBOT) Futures Exchange.  This spreads the volatility and risk in relatively equally weighted contracts. The fund has over $640 million in assets under management.

The ETF is up 49% in 2022 with most of those gains coming after the Russian invasion of Ukraine. However, investors should be advised that the fund carries a hefty expense ratio of 1.0%.

About Teucrium Wheat Fund

Teucrium Wheat Fund (the Fund) is a commodity pool. The Fund is a series of the Teucrium Commodity Trust (Trust). The Fund provides investors unleveraged direct exposure to wheat without the need for a futures account. The investment objective of the Fund is to have the daily changes in percentage terms of a weighted average of the closing settlement prices for three futures contracts for wheat (Wheat Futures Contracts) that are traded on the Chicago Board of Trade (CBOT), which includes the second-to-expire CBOT Wheat Futures Contract, weighted 35%; the third-to-expire CBOT Wheat Futures Contract, weighted 30%, and the CBOT Wheat Futures Contract, weighted 35%. Read More 
Current Price
$8.84
Consensus Rating
N/A
Ratings Breakdown
0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
N/A



 

An additional benefit to having commodities in your portfolio is that they help diversify your portfolio. Historically commodities have a negative correlation with stocks and bonds. This means when the value of one asset class goes up the other goes down. And at times when inflation is outpacing the return you get from your other investments, commodities serve as a hedge that can boost your total return.

But investing in commodities is not without risk. Commodity prices are subject to sudden, and strong, price movements. And most commodity trading is done by investors who use futures contracts. However, in 2022, individual investors have the option of investing in exchange-traded funds that help take a little of the risk out of investing in commodities.

The seven ETFs listed in this presentation are just the tip of the iceberg. The reality is if a specific commodity interests you, there is most likely an ETF that tracks its performance. This can be a benefit for investors who have specific knowledge in a particular commodity sector.

More Investing Slideshows:


MarketBeat Resources

Premium Research Tools

MarketBeat All Access subscribers can access stock screeners, the Idea Engine, data export tools, research reports, and other premium tools.

Discover All Access

Market Data and Calendars

Looking for new stock ideas? Want to see which stocks are moving? View our full suite of financial calendars and market data tables, all for free.

View Market Data

Investing Education and Resources

Receive a free world-class investing education from MarketBeat. Learn about financial terms, types of investments, trading strategies and more.

Financial Terms
Details Here
MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau MarketBeat is rated as Great on TrustPilot

© American Consumer News, LLC dba MarketBeat® 2010-2022. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | contact@marketbeat.com | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Privacy Policy | Do Not Sell My Information | RSS Feeds

© 2022 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart's disclaimer.