The Lemon Fool

Hi,

I am looking to diversify my portfolio particularly to protect against inflationary forces and am interested in investing in 1 or more actively managed commodity funds/trusts. I already own two metal ETFs - COPA.L and PIMT.L, but given that I am lazy and dont want to keep track of the complex shifts in markets I am interested in looking at some actively managed funds. So what are your favourites? I am open to metals; chemicals/oil; Food etc. or funds that track a combination fund. Really want a fund that will optimise for growth and balance my portfolio if we start entering a time of excessive inflation.

Thanks,

J

I have had JP Morgan Natural Resources since it was Ebor Commodity in 1970. It has been a good performer.

Blackrock's World Mining IT seems popular but I know little about it.

TJH

innocuous wrote:Hi,

I am looking to diversify my portfolio particularly to protect against inflationary forces and am interested in investing in 1 or more actively managed commodity funds/trusts. I already own two metal ETFs - COPA.L and PIMT.L, but given that I am lazy and dont want to keep track of the complex shifts in markets I am interested in looking at some actively managed funds. So what are your favourites? I am open to metals; chemicals/oil; Food etc. or funds that track a combination fund. Really want a fund that will optimise for growth and balance my portfolio if we start entering a time of excessive inflation.

Thanks,

J

I am actively considering Blackrock World Mining to complement my holding in RIO. Not a recommendation but you may like to look at today's interims:

https://www.investegate.co.uk/Index.asp ... words=brwm

I hold BERI, CYN and BRWM. Unfortunately BRWM was a more recent addition and has been going down pretty much since I bought in, currently c -12%s. BERI has done best and is more diversified as it invests in miners (inc gold), commodities and energy (renewable and traditional).

innocuous wrote:I am looking to diversify my portfolio particularly to protect against inflationary forces
J

Not sure how those two elements link. Diversification is about reducing idiosyncratic risk, hopefully leaving you with just market risk; or reducing the risk of wiping out your commodities if you hold only one fund and it collapses. But I don't see that adding more commodity funds reduces inflation risk by diversification, although it might help by holding more commodities if commodities cope well with inflation.

Thanks all for your suggestions. I am also looking at the Troy Trojan Fund. As I understand it, they aim to beat inflation by taking on a broad spectrum of inflation resistant equities; bonds (Tips at the moment given the climate); and commodities like physical gold. Its a managed portfolio....what do you guys think about it?

JohnW wrote:

innocuous wrote:I am looking to diversify my portfolio particularly to protect against inflationary forces
J

Not sure how those two elements link. Diversification is about reducing idiosyncratic risk, hopefully leaving you with just market risk; or reducing the risk of wiping out your commodities if you hold only one fund and it collapses. But I don't see that adding more commodity funds reduces inflation risk by diversification, although it might help by holding more commodities if commodities cope well with inflation.

I take your point. My theory is that I am just biasing my portfolio slightly to take advantage of broad themes. In general, there are some commodities where prices increase as inflation increases. Of course it depends what is causing the inflation so its not a one size fits all, but right now with billions being pumped into the economies and in general western citizens being more liquid than before I sense that some commodities will go up as demand increases; some commodities will go up because people want to avoid holding cash (gold).