UBS CMCI Commodity Transition SF UCITS ETF A-acc
| Issuer: UBS |
| Asset Class: Commodity |
| TER: 34bps |
| Trading Currency: GBX |
| Pays Income: False |
| Listing Date: 13 Jun 2023 |
| Ticker: CDTR |
| ISIN: IE000WJCYGB4 |
This investment product provides broad exposure to a diversified basket of global commodities through a sophisticated futures-based strategy. The portfolio spans key sectors including energy, industrial metals, precious metals, agriculture, and livestock, offering a comprehensive representation of the commodity landscape. Unlike strategies that solely track the spot price movements of commodities, this fund's underlying index employs an advanced methodology designed to capture additional sources of return inherent in the futures market. By doing so, it aims to deliver a more complete picture of the performance of this asset class.
The core of the strategy lies in its dynamic management of futures contracts to optimize 'roll yield'. In futures markets, as contracts near expiration, they must be 'rolled' to a later-dated contract. This process can result in a gain (backwardation) or a loss (contango). The fund's benchmark index systematically selects contracts across the futures curve with the most attractive roll characteristics, aiming to maximize gains from backwardation and minimize losses from contango. This 'carry' strategy differentiates it from traditional commodity indices that often follow a predefined rolling schedule, which can be detrimental in certain market conditions.
This product can serve as a valuable diversifier within a traditional investment portfolio, as commodity returns often exhibit a low correlation to equities and bonds. It may also act as an effective hedge against inflation, given that commodity prices tend to rise during periods of increasing price levels. The total return structure, which includes returns from price changes, roll yield, and interest on collateral, offers multiple drivers of performance. It is suited for investors looking for a more nuanced and potentially enhanced approach to gaining exposure to the global commodity markets.
