iShares is offering another exchange traded fund for investors.
Nasdaq today announced that BlackRock will list a new exchange-traded fund, the iShares Commodities Select Strategy ETF (Symbol: COMT). COMT will begin trading on Nasdaq today, October 16th.
COMT is innovatively structured to provide cost-effective, simple access to a diversified mix of commodities through futures and commodity-related companies. The fund is intended to be an all-in-one commodity solution by providing comprehensive commodity exposure in a smarter, more efficient way through both futures and equities; removing a tax barrier that may have kept investors away from commodities and utilizing a roll methodology that seeks to improve returns.
The fund manager uses a roll methodology designed to minimize the negative return impact of ‘contango’, which describes a term structure of the futures curve where the future price is above the expected future spot price. Additionally, the ETF structure of COMT alleviates the need for investors to file a K-1 at tax time.
“The iShares Commodities Select Strategy ETF provides investors with comprehensive commodity exposure in a simple, efficient way through futures and equities and removes a tax barrier that may have kept investors away from commodities,” said Patrick Dunne, Head of iShares Global Markets and Investments at BlackRock.
Earlier this year, Greenwich Associates published a study that showed institutional investors are using ETFs more in their portfolios and are allocating a greater amount of cash and space to the asset class. The study, “ETFs: An Evolving Toolset for U.S. Institutions,” was sponsored by BlackRock and found that institutional investors are adopting ETFs both as an every-day tool in routine portfolio functions and as a means of obtaining long-term strategic investment exposures.
