For investors seeking momentum, United States Commodity Index Fund (USCI – Free Report) is probably on radar. The fund just hit a 52-week high and is up about 63% from its 52-week low price of $38.41/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
USCI in Focus
United States Commodity Index Fund’s investment objective is for the daily changes in percentage terms of its shares’ net asset value (“NAV”) to reflect the daily changes in percentage terms of the SummerHaven Dynamic Commodity Index Total Return. The index is designed to reflect the performance of a portfolio of 14 commodity futures from 27 possible futures contracts. The product charges 1.01% in annual fees (see: all the Broad Commodity ETFs here).
Why the Move?
The commodity market has been an area to watch lately, given the spike in the prices. Commodities have been on a hot streak this year, buoyed by the shortage of energy and food supplies amid higher demand. Skyrocketing inflation that compelled central banks to raise interest rates along with Russia’s invasion of Ukraine has further disrupted energy and grain supplies in an already-tight commodity market.
More Gains Ahead?
It seems that USCI might remain strong given a weighted alpha of 61.3 and 20-day volatility of 16.1%. As a result, there is definitely still some promise for risk-aggressive investors, who want to ride on this surging ETF.