June 13, 2011 at 07:00 AM EDT
Commodity ETF Investing: Five Factors To Consider
Commodity ETPs can be extremely powerful tools for tapping into an asset class capable of providing both return enhancement and diversification benefits. With dozens of products available–there are more than 120 U.S.-listed commodity ETFs according to the ETF screener–picking the right fund for your investment objectives and risk tolerances can be challenging. Beyond the type of commodity included, there can be several attributes of commodity ETPs that shape the risk/return profile; below, we look at five factors to consider when trying to narrow down the universe and find the right commodity ETF (or ETN): 1. Structure: ETC vs. ETN Most investors are familiar with the various product structures that are generally lumped together under the ETF umbrella, including exchange-traded notes, HOLDRs, and UITs. While the fine print of various security types may seem like inconsequential details, the nuances can have a meaningful impact on bottom line returns–especially in the commodity [...] Click here to read the original article on ETFdb.com. Related Posts: iPath Debuts Seasonal Natural Gas ETN (DCNG) Ten Commodity ETFs Every Investor Should Know (But Most Don’t) UNG Springs A Leak Strange Times For The Natural Gas ETN (GAZ) Ten Worst Performing ETFs Of 2010
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