Can anyone recommend a good agriculture index fund?

Discussion in 'Commodities Forum' started by SteakTartare, Mar 13, 2015.

  1. SteakTartare

    SteakTartare Senior Investor

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    The title kind of says it. I'm doing some homework on agricultural index funds because I'd like to park some, albeit a little, investment money in said. Anyone have a pic I should add to the research list?

    Thanks much.
     
  2. crimsonghost747

    crimsonghost747 Senior Investor

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    No personal experience from investing in the field of agriculture.
    But in general iShares does a pretty solid job of managing their ETFs. Quick google search came back with 2. One of them is an index fund like you requested but surely it won't hurt to take a look at the second one either.

    iShares Global Agriculture Index ETF
    iShares MSCI Global Agriculture Producers ETF
     
  3. Colebra

    Colebra Well-Known Member

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    Great question!
    These sound like a no-brainer, right? Monsanto sure isn't going anywhere.

    But this one's (iShares MSCI Global Agriculture Producers ETF) performance doesn't look that great...
    This one (iShares Global Agriculture Index ETF) looks awesome!

    Both ETF's only have 10 Holdings.

    The main problem with this industry is being dependent on the weather, right?
    Plus, I've always seen people on Shark Tank saying that food products have very low margins...
     
  4. crimsonghost747

    crimsonghost747 Senior Investor

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    Nope, neither has 10 holdings. Be careful when looking up info, as I think you found their website and checked the holdings part. But there is a "TOP10" tab and then "ALL" tab that shows you the rest of the holdings. Also the amount of holdings is usually marked separately in the ETF info.

    Instead of trusting what people on shark tank say you can dig up yearly reports from agricultural companies (like if going for the ETF I'd want to see the reports of the top few holdings at least) and see what their margins are. :)
     
  5. JR Ewing

    JR Ewing Super Moderator Staff Member

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  6. Colebra

    Colebra Well-Known Member

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    Yap.
    I actually knew I had to click "ALL", but I was looking at it at work so I missed it.

    iShares MSCI Global Agriculture Producers ETF is composed of 131 Holdings.
    iShares Global Agriculture Index ETF is composed of 37 Holdings.
    Monsanto has the biggest % in both.

    Fixed. :p

    The weather plays a big part in this, right?

    Also, why is this ETF's % expressed in commodities, instead of companies who deal with those said commodities?

    Thanks, guys!

    Sorry for stealing your question SteakTartare...
     
  7. crimsonghost747

    crimsonghost747 Senior Investor

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    Without taking a deeper look at it, this would most likely be because the ETF is made out of futures for said commodities. So the ETF doesn't actually own any shares of companies, only commodity futures.
     
  8. JR Ewing

    JR Ewing Super Moderator Staff Member

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    This.

    And yes, weather is one of many things to worry about with commodities. I don't personally have the time nor the inclination to try to guess these things with futures, so commodities exposure is one thing I outsource via ETFs that either buy / sell futures on perishable commodities, or buy / store / sell some actual commodities like metals.
     
  9. SteakTartare

    SteakTartare Senior Investor

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    Thank you all for the pics. I've blocked/copied them to a local file for further analysis. Much appreciated.
     

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