A Red-Hot Copper Fund Could Lose Its Shine
- Date: 22-Apr-2021
- Source: The Wall Street Journal
- Sector:Financial Markets
- Country:Middle East
A Red-Hot Copper Fund Could Lose Its Shine
“Copper is the new oil” wrote Goldman Sachs in a widely-cited report. Individual investors are taking notice.
The metal's price has soared roughly 90% over the last 12 months, with bulls pointing to robust demand from the world's transition to green energy and speedy economic growth in China, which accounts for about half of global consumption.
Fund flows into the United States Copper Index Fund , the largest exchange-traded product for copper, soared starting in the second half of 2020 alongside the commodity's rising price. The fund, with the ticker symbol CPER, was launched in 2011, but it only had $5 million to $10 million in assets under management until early last year. As copper prices picked up, assets ballooned to $100 million by this January and have more than doubled since then to roughly $225 million today, according to Kurt Nelson, Managing Partner at SummerHaven Investment Management, which manages the fund.
The rush comes just about a year after another commodities index fund operated
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