Market Overview

The Best Commodity Investment Of 2016

The Best Commodity Investment Of 2016

This year has been a great year for stock investors, but it has been an even better year for commodities investors. While the SPDR S&P 500 ETF Trust (NYSE: SPY) is up 10.6 percent on the year, the PowerShares DB Com Indx Trckng Fund (ETF) (NYSE: DBC) has surged 16.2 percent on the year.

Oil has captured a lot of the commodity headlines this year. After dipping below $30/bbl in February, WTI crude oil found its stride. The cherry on top of a stellar year for oil was the OPEC production cut in late November. OPEC agreed to dial back production for the first time since 2008 to help eliminate the global supply glut. WTI crude prices are up roughly 50 percent in 2016.

However, while oil is getting much of the attention, natural gas has been the under-the-radar commodity superstar of 2016. Gas prices have surged from $2.28 at the end of 2015 to $3.55 headed into the end of the year, a gain of 55.7 percent.

Natural gas prices are finishing the year particularly strong. President-elect Donald Trump repeatedly emphasized the role that natural gas will play in his energy policies. In addition, this December may end up the coldest December for the U.S. in more than 15 years, which is good news for natural gas demand.

The United States Natural Gas Fund , LP (NYSE: UNG) has significantly lagged the spot price of natural gas this year, gaining only 2.6 percent year-to-date.

Posted-In: CommoditiesNews Specialty ETFs Commodities Markets Movers Trading Ideas ETFs Best of Benzinga


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