Profit From The Commodities Rally With These ETFs

  • (0:45) - Commodities On The Rise: Will This Continue?
  • (3:00) - Surging Oil Prices: What Is The Best Way To Invest
  • (5:30) - 2018 Gold Outlook: Gold Metal Or Miners?
  • (8:00) - VanEck Vectors Agribusiness ETF: MOO
  • (9:45) - Real Asset Allocation ETF: RAAX
  • (11:40) - Episode Roundup

In this episode of ETF Spotlight, I talked with Roland Morris, Chief Commodity Strategist and Portfolio Manager at VanEck.

Commodities are rallying after many years of underperformance. The Bloomberg Commodity Spot Index has surged more than 15% over the past year.

Roland says that first quarter of 2016 marked the low for the commodities cycle. Weak global growth, oversupply, and a strong dollar had kept commodities under pressure but some of these headwinds have turned into tailwinds over the past few months.

He sees the trend continuing as it appears that we are in a classic cyclical bull cycle for commodities and these cycles typically last 5-7 years.

We discussed why commodities deserve a place in a diversified portfolio. Commodities provide diversification benefits and as well as a hedge against inflation.

Oil, one of the best-performing commodities this year, had soared to its highest levels since 2014, thanks to increasing demand, OPEC cuts, rising geopolitical risks and looming sanctions on Iran and Venezuela,

However, prices plunged last week on reports that OPEC and Russia are set to increase output.

Roland sees this as a temporary pause. He thinks that oil will stay range-bound which is good for US shale oil producers. He believes there is not a not a lot of spare capacity. On the other hand, global demand has been very steady.

We discussed the VanEck Vectors Unconventional Oil & Gas ETF (FRAK - Free Report) that holds companies involved in unconventional oil and natural gas production, exploration and refining, and the VanEck Vectors Oil Services ETF (OIH  - Free Report) that holds 25 of the largest US oil services companies.

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