Investors, seeking to diversify their portfolio and hedge against rising inflation, have increased their exposure to commodities by directly purchasing commodities, by taking outright positions in commodity futures, or by acquiring stakes in exchange-traded commodity funds (ETFs) and in commodity index funds. This pattern has accelerated in recent years. According to index investment data collected by Barclays Capital for US and non-US assets under management, commodity index investment has increased from $55 billion in late 2004 to $431 billion in July 2011.
Wednesday, October 26, 2011
Sunday, October 2, 2011
Bahattin Buyuksahin’s research on the role of speculators in crude oil prices, with Jeff Harris of the Syracuse University, was the focus of an article on SeekingAlpha.com. The article discusses Buyuksahin and Harris’ research, summarizing their conclusion: “They do not dispute a correlation between speculative activity and oil price – the participants in the oil futures market increased dramatically during the oil price spikes of 2007-8 - but they do not assume causation..” ViewFull Article (1/5/12)
On August 24, 2011, I discussed Prof. Ken Singleton's new research paper, entitled "Investor Flows and the 2008 Boom/Bust in Oil Prices" at the U.S. Energy Information Administration's "Financial and Physical Oil Market Linkages Workshop" in Washington, DC. You can find my discussions here.