Keeping up with evolving approaches to asset allocation, our commodity indices offer the potential to improve diversification and have historically provided liquidity and inflation protection.
Two Flagship Benchmarks Delivering Pure Beta
As a leader in commodity indexing, we offer a wide range of solutions anchored by two true reflections of commodity beta, the S&P GSCI and Dow Jones Commodity Index (DJCI).
Click below to see the key indices in each family, along with a summary of their performance:
Historical Benefits of Commodities
Historically, commodities have had low correlations to stocks and bonds because the sources of return are inherently different. Because commodities are necessary, often-used staple goods, they can also provide diversification during economic crises.
Commodity indices tend to have a positive correlation to inflation because they reflect our changing expectations of future prices. Historically, one dollar of investment in a broad-based commodity index has provided more than one dollar of inflation protection, because food and energy carry more weight in these indices than in the CPI.
To promote investability, the weight of each commodity in the S&P GSCI® is based on its volume of futures contracts traded. As a result, the index tends to have higher weights in crude oil, natural gas, and heating oil. The DJCI employs a simple, straightforward, equal-weighted approach, so that one-third of the index is devoted to agriculture and livestock, one-third to energy, and one-third to metals.