Commodities Win Last Week

Broadly defined commodities topped the winner’s list last week, rising to the highest level since last summer, based on a set of based on a set of exchange-traded products representing the major asset classes.

By James Picerno


Emerging-market (NYSEARCA:EEM) equities were close behind, rising for the third straight week during the five trading days through Feb. 10. Meantime, last week’s losers were limited to foreign bonds (in US dollar(NYSEARCA:UUP) terms).

The iPath Bloomberg Commodity ETN (DJP) was clearly in the lead last week, posting a strong 1.9% gain and closing at the highest price since last July.

Vanguard FTSE Emerging Markets (VWO) was in close pursuit, rising 1.6% — the third weekly advance that lifted the fund to its highest close since the mid-2015.

In the losers circle for last week are three funds targeting various slices of foreign bonds. iShares International High Yield Bond (HYXU) suffered the biggest setback, slumping 1.2%.

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The generally positive trading week continued to lift an ETF-based version of the Global Markets Index (GMI.F). This investable, unmanaged benchmark that holds all the major asset classes in market-value weights climbed 0.5% last week. The gain marks the third positive weekly total return in a row.


For the one-year return window, emerging-market stocks continue to lead the field. VWO’s total return is a sizzling 36.9% over the trailing 252 trading days through Feb. 10.

In a repeat of last week’s update, government bonds in foreign developed markets remain in last place for one-year performance. SPDR Bloomberg Barclays International Treasury Bond (BWX) is off 2.9%.

GMI.F’s one-year trend remains firmly in the black, posting a strong 17.6% total return through Feb. 10.

For some perspective on what to expect from the major asset classes in the long run, here’s the current monthly estimate for risk premia projections.