Do Commodities Still Work as Portfolio Diversifiers?

As investors increasingly treat commodities as financial assets, their value as portfolio diversifiers has diminished.

Amy C. Arnott 30 April, 2021 | 9:50
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Commodity diversifier

 

Commodities are often touted for their diversification benefits. Because their prices mainly depend on the balance of supply and demand, they often show very low correlations with other asset classes.

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Amy C. Arnott  Amy C. Arnott, CFA, is director of securities analysis for Morningstar.

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