Higher inflation and a teetering stock market should spur advisors to think about diversifying client portfolios by adding commodities, investment experts urged this week. These economic factors, a potential bottom in the commodities price cycle, as well as the move of institutional investors into this sector, also are signs that portfolios should be adjusted to include this asset class.
“Commodities have been on a positive track since 2016, but people are frustrated in 2018 because the broad [commodity] benchmarks are stalled,” said Tim Pickering, founder, president and CIO of Auspice Capital, a Calgary, Canada-based investment firm, during a webinar held by Direxion discussing trade wars and commodities. “In fact the Bloomberg Commodity Index is down on the year, but all [commodity] sectors are not. There’s diversity in commodity sectors, and there are opportunities if you’re tactical.”