- The precious metals sector was the best performing commodity sector in H1 2010, up 13%. Gold was the strongest performer rising 23% in Sterling, 34% in Euro and 14% in US dollars, continuing its run as one of the best performing assets over the past ten years. This compares to a 14% decline in the FTSE 100 Index and a 20% decline in the EuroStoxx 50 index in USD over the period1. Flows into gold ETPs rose at an unprecedented pace, with ETF Securities seeing gold ETC assets rising almost $3bn to $11.4bn. Global physically-backed gold ETP assets soared to $83bn, up $18bn (29%)1.
- Agriculture returns were extremely diverse - ranging from an 18% rise in ETFS Coffee to a 40% decline in ETFS Sugar, reflecting the wide variety of factors affecting the agriculture markets. Agriculture ETCs have seen amongst the steadiest inflows overall since the credit crisis in late 2008, with net purchases in most of the trading weeks since the start of 2009.
- Energy saw mixed performance with oil trading around a $70-$85/bbl range and natural gas prices rebounding at the end of the half. ETC investors appeared to be well-informed on trading the oil price range with long inflows rising at the bottom of the price range and long outflows and short positions increasing at the top. Positions were reduced in natural gas ETCs as prices rose.
- Industrial metals saw sharp declines as risk appetite fell and China growth concerns took their toll in Q2. Despite the sharp declines in Q2, the strength of the rally in 2009 meant that industrial metals as a group were still up over 20% on a 12 month basis. ETFS Short Copper saw record inflows in Q1 as some investors' correctly hedged against price declines in Q2.
Clickhere to view ETF Securities' full report on Commodities Review H1 2010
1Based on Bloomberg and relevant issuers' data.