Opinions John DeGoey
iShares Broad Commodity ETFCBR.TOPAST TOP PICKDec 20, 2011
John DeGoeyStock price when the opinion was issued
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(Top Pick Feb 14/13, Down 7.17%) Inflation hedges have not performed as well.
John DeGoeyAll of these ETFs that have commodity futures in them have some issues. They try to mitigate them by not holding the front month and back month contracts. But they still have some contango. You can get up to a 6% drag from the rollover of futures contracts so unless you have robust growth in commodities, that drag will hurt performance. For the next 2-3 years he thinks we will not have such robust growth in commodities.
Commodities have really underperformed and this is exactly why he is talking about this. Believes in this as being a long-term Hold. In the long-term he thinks commodities are going to do very well.
John DeGoeyMake fracking sand. Rough year. Chinese imported synthetic fracking sand but now realize it is a lower quality and are moving back. 16x earnings. Nat Gas will be favourable now that Obama won election.
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