Commodities’ usefulness in a portfolio context – an empirical study
Commodities’ usefulness in a portfolio context – an empirical study

Summary/Abstract: By adopting the perspective of a US equity investor, in this study we empirically verify the diversification benefits resulting from investing in commodities. We make an assessment for specified commodity groups using the commodity sector indices. In the employed methodology we focus only on the risk characteristic of the analyzed portfolios. Our results indicate that the diversification potential of different commodity groups is highly cross-varying, however, at any time greater than the risk-reduction possibilities offered by Emerging Markets equities.

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