Sugar is a consumable exported throughout the world. Although consumer trends shift from health-conscious alternatives and back, the marketplace has remained consistent as manufacturers use the product in commercial manufacture of food and beverage products. Rather than direct investing in this agricultural commodity, a good alternative and indirect purchase of sugar through exchange-traded futures of companies involved with some aspect of the sugar industry provides a less risky investment strategy. Which sugar ETF is the right choice for you? That depends on your current portfolio and also the type of diversification that you wish to increase the existing collection.
How to pick the right Sugar EFT
According to Investopedia, Since the first SPDRs were established in 1993, EFTs tracking of indexes have surged in attraction to investors. With so many available, choosing can seem complicated. The first step is to compare recommendations that suit in your investing style and preferences for benchmarking indices. Think about the holdings of the fund, the total value of assets, and previous performance in your analysis. If the goal is to locate a profitable ETF for inclusion inside your portfolio, if you are looking for a low-cost strategy for building the optimal portfolio and when you value efficiency, you’re within the right place. We’ve consulted the most respected sources to identify the very best sugar ETFs for 2021. They’ll give you a few options for discussion with your financial advisor to pick the right sugar ETF for your financial commitment needs.
Power Rankings for the sugar commodity
EFTBF.com has analyzed the power rankings of sugar on the commodities market. It explains that the rankings compare sugar with all of the other listed commodities in United States markets following a set of investment-oriented metrics. Included in this are fund flows for 3-month intervals, the AUM average, ETF expenses, together with average dividend yields. The outcomes include calculations from sugar just with all other classes of assets and inverse ETFs excluded. It provides you with a sense of trends inside the sugar industry. Sugar is ranked in the 18th position in the three-month fund flow, 10th in the average three-month return, and 19th within the aggregate AUM.EFT.com has further ranked the commodity in the 15th position for average dividend yield and number 17 for that average expense ratio. Here are three sugar ETFs recommended for consideration with the top two US-based sugar ETFs.
Teucrium Sugar ETF
US News reports that Tecruium Sugar is among the best sugar ETFs available for 2021. Everyday changes in the NAV of Teucrium’s shares are reflected because the sugar market moves. Future delivery is monitored and measured carrying out a weighted average of the prices at closing settlements for 3 sugar futures contracts. These contracts are traded around the ICE Futures US. The investment objective of the fund is to invest in Benchmark Component Futures Contacts under normal market conditions. Management uses the full amount of the assets from the fund for trading sugar futures contracts and making investments in cash and the equivalents of cash. The appeal of his ETF to investors is it offers exposure to investment in sugar companies indirectly. Investments are less volatile than direct investments in to the stocks of companies active in the sugar industry.
Wisdom Tree Sugar ETF
Investing.com highlights Wisdom Tree Suger ETF as a recommendation for those who wish to diversify with exposure to the sugar commodity. Wisdom Tree is classed in the financial sector under miscellaneous financial services. Wisdom Tree is definitely an equity-based ETF in the United Kingdom market. ETFS may be the issuer of the notes. The Wisdom Tree ETF lists in the commodity for its general class. Bloomberg Sugar TR is underlying. The main activity of the fund deals with short and leveraged commodity contracts and classic and longer-dated commodity contracts. The company facilitates the trading of Wisdom Tree Sugar ETF investments covering commodities including, but not limited to the sugar market solely, with fixed income and equities traded on exchanges throughout the world. This ETF may be one you intend to consider if you desire an asset distribution on the broad range of industries.
iPath Series B Bloomberg Sugar Subindex Total Return ETN/ETF
According to Zacks, SGG is an agricultural exchange-traded fund listed on the Nyse with a focus on the sugar commodity. The ETF expense ratio is 0.45% with a dividend yield of 0%. The issuer is Barclays Bank. This ETF provides investors with exposure to the sugar market through the Bloomberg Sugar Subindex Total Return, reflecting the returns available through futures contracts on companies involved in either the growth, harvest, manufacture or distribution of sugar within an unleveraged format. Since its inception, The overarching objective of this fund is to present a benchmark for sugar as an asset class. SGG has made no dividend distributions. Returns hoped for are earned on cash collateral.
Any investment in commodities represents a risk to investors. Sugar is a cyclical agricultural-based commodity that is subject to a number of influences and potential impacts. Production volumes depend on climate and weather conditions. Harvesting, marketing, and export of sugar rely on political and economic conditions. Multiple influences have the potential to either positively or negatively impact the companies involved in the sugar industry. Futures contracts through an exchange-traded fund are managed uniquely with methods that lessen volatility and risk for investors. Each contract should be looked at closely to determine the particulars about investment duration and contract expirations for any limitations on trading. They offer a more affordable vehicle for investing indirectly within the sugar commodity. It is important to note that sugar has been on an upswing in recent months. Before making your decision, it’s wise to consult with your financial advisor about which sugar ETF would be the best for inclusion in your investment portfolio.