Commodity Index

Information of Commodity Index Investing

Commodity Index

A Commodity index is a mathematical calculation that averages the head counts, weights and prices of a commodity to determine its settlement price. The Primary Commodity report provides information on commodities, status, location, primary name and the data for each occurrence in your dataset. It will also count how many occurrences have a specific primary commodity.

Here are a few commodity exchanges that have valuable information.

• CRB Index Futures (CR)
• Dow Jones Industrial Average Futures (DJ, CBOT)
• Mini Dow Jones (YM, CBOT)
• Goldman Sachs Index (GI, CME)
• Value Line Index (MV, KCBOT)
• London FT-SE 100 (LZ, LIFFE)
• NASDAQ 100 Index Futures (ND, CME)
• NASDAQ 100 E-mini Futures (NQ, CME)
• Nikkei Index (NK, CME)
• NYSE Composite Index
• Russell 2000 Index (CME)
• Russell 2000 Index- E-Mini (CME)
• S and P 500 (CME)
• S and P Midcap 400 (CME)
• S and P Midcap 400 E-Mini (CME)
• S and P E-Mini (CME)
• Short Sterling (SS, LIFFE)
• U.S. Dollar Index (CEC)

The history of booms and busts

A really interesting fact! Stocks and commodities have always moved in opposite directions. For example, during the 1960s and 1970s, commodities boomed but stocks did not. In contrast, during the 1980s and 1990s, stocks did well but commodities did not. Now the question is, whether it is ever possible that in the same period, both commodities and stocks will shine? Like the mutual bull run for a period in 2003. Anyones guess!

Despite the potential diversification benefits of commodities, most investors stick to financial assets in their portfolios because stocks and bonds have traditionally been easier to invest in and commodities can be volatile. However, the development of products that track a broad index of commodity futures should make it easier for investors to reap the diversification benefits commodities can provide, and the potential for volatility in commodities can actually be a positive factor in the context of an overall portfolio.