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If you’ve watched Trading Places, you’ll recall the Dukes’ somewhat rudimentary depiction of the world of commodities and their role as brokers, as well as the sometimes frantic activity in the trading pits. In the 40 years since the movie’s release, most “open outcry” trading pits have been replaced by more efficient electronic trading systems, and additional safeguards and regulations have been introduced. Here, we explore the commodity asset class and its role in investor portfolios.
Using the Bloomberg Commodity Index (“BCOM”) as a proxy, commodities can be grouped broadly into energy, metals and agriculture commodities, but also can be split into the following sub-sectors.
