ANALYSIS: Supply the key in commodities conundrum

Added 26th May 2016

Oil’s recent jaunt through $50 a barrel, its highest level since November last year, highlights once again how suddenly things can change, particularly when it comes to the commodities complex.

ANALYSIS: Supply the key in commodities conundrum

The price of crude has almost doubled since the middle of January on the back largely of a growing belief that supply was beginning to come out of the market – a remarkable change from the start of the year when many were predicting that the price could continue to fall even further.

But, oil is not the only commodity toward which investors have had a rapid change of heart. As Adrian Ash, head of research at BullionVault reminded Portfolio Adviser, gold’s rise in the first quarter was the fastest dollar increase in 30 years. And was followed, he said, by significant interest in the sector, particularly through ETFs and nominated accounts on behalf of family offices.

Those investors that put money into active funds were also rewarded. As can be seen from the table below, of the top 20 performing funds year-to-date 13 are gold or general resources funds. Of the remaining seven, two are Brazil funds, one is Russian-focused and two are broad Latin American funds, all of which have significant commodities exposure.

Top 20 funds

Fund YTD performance %

MFM Junior Gold

WAY Charteris Gold & Precious Metals 88.28
Smith & Williamson Global Gold & Resources  63.94
Investec Global Gold  63.20
CF Ruffer Gold  57.66
BlackRock Gold & General  54.99
Old Mutual Blackrock Gold & General  54.69
SF Peterhouse Smaller Companies Gold 51.95 
CF Canlife Global Resource  30.60
HSBC GIF Brazil Equity  28.43
Legg Mason IF Japan Equity  26.95
Old Mutual JPM Natural Resources  24.94
Invesco Perpetual Japanese Smaller Companies  24.77
JPM Brazil Equity  24.61
BlackRock GF World Mining   23.92
Pictet Russian Equities TR   23.29
JPM Natural Resources   23.24
Scottish Widows Latin American  23.06
Aberdeen Latin American Equity   22.25
First State Global Resources   21.87



















Source: FE Analytics

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About Author

Geoff Candy

Group digital editor

Geoff Candy joined Portfolio Adviser as News Editor in May 2014. He has been a financial journalist and broadcaster since 2005 and, in that time has worked in both South Africa and the Netherlands, covering everything from high street retailers and construction companies to mining and insurance.


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