Commodities have become an intrinsic part of a well-balanced portfolio due to their inflation fighting and diversification properties. The question is no longer whether to hold an exposure to commodities, but how much. Equally important in that conversation should be how to implement this exposure. Many active commodity investments are fraught with complexity and expensive fee structures. Passive commodity investments suffer from poor index construction that can lead to very concentrated portfolios and unintended risk. Both solutions can undercut the very motivations for investing in commodities in the first place.
Parametric takes an approach to commodities that borrows elements from active and passive investing within a framework we call Structured Active portfolio management. The key tenets of our strategy are broad diversification and rules-based, systematic portfolio rebalancing.
To learn how these disciplines lead to a thoughtful commodity investment, click here:
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