Commodity
For institutional investors
A well-diversified portfolio goes beyond equities and fixed income. An allocation to commodities helps to diversify your institution’s portfolio while also providing some inflation protection.
Parametric’s Commodity Strategy uses a unique portfolio construction process that provides greater diversification than traditional commodity benchmarks. Through intelligent design and rules-based methodologies, the strategy seeks to outperform the Bloomberg Commodity Index over three to five years, while experiencing 90% to 95% of the index’s volatility.
There is no guarantee that the investment objective will be achieved. The targeted return is hypothetical and should not be relied upon to make investment decisions. The targeted return is aspirational in nature and is not based on criteria and assumptions. All investments are subject to the risk of loss. See disclosures for additional information.
Investing in a commodity strategy involves risk. All investments are subject to loss. Learn more.
Explore our fixed income solutions
Why choose Parametric?
How it works
Diversification, intelligently designed
Unlike traditional asset classes, commodities don’t have a “market cap” equivalent. As a result, each commodity index provider constructs benchmarks according to its own unique example. While no benchmark is superior to another, they often exhibit sector concentrations, particularly when it comes to crude oil and agriculture.
Parametric avoids these concentrations by broadly diversifying across commodity types and sectors, including significant allocations to non-index commodities. That gives investors access to underrepresented commodities and increases overall portfolio diversification.
We reweight the portfolio to reduce concentration risk and dynamically rebalance through time to reinforce diversification. Our rebalancing techniques seek to enhance potential returns while minimizing implementation friction.
Sources: Bloomberg, Parametric as of 12/31/2020. It is not possible to invest directly in an index.
Intended benefits of Commodity Strategy
Inflation protection
Learn more >>
Commodity prices are correlated with inflation. An allocation to commodities acts as an inflation hedge.
Exposure
Learn more >>
Our long-only strategy lets investors fully capture the characteristics of the commodity asset class.
Transparency
Learn more >>
Our Commodity Strategy uses an easy-to-understand rules-based methodology to avoid human bias.
Diversification
Learn more >>
Our investment process maintains diversification across commodity types and sectors and gives you exposure to commodities not traditionally included in most indexes.
Get in touch
Want to know more about our Commodity solutions? Complete our contact form, and a representative will respond shortly.
More to explore
While the Last Round in the Inflation Fight Might Be the Hardest, Don’t Expect Gold to Outperform
by Greg Liebl, Director, Investment Strategy; Adam Swinney, Investment Strategist
March 4, 2024
Read why we think it makes sense to prepare for bouts of unexpected inflation by including a modest allocation to diversified commodities in a resilient core portfolio.
2024 Institutional Outlook: Working with Investors to Help Enhance Portfolio Value
by Chris Uhas, Managing Director, Head of Institutional Distribution
January 29, 2024
What matters most to institutional investors in 2024? Here’s what we think.
2024 Commodity Outlook: Peak Rates and Inflation Give Way to a Sustainable Future
by Greg Liebl, Director, Investment Strategy; Adam Swinney, Investment Strategist
January 8, 2024
Read why we think commodities belong in a well-diversified portfolio, even after interest rates and inflation have peaked.