Commodity and Natural Resources Fund Offers Profit Potential

Commodity and natural resource investments may be omitted from many portfolios, but such allocation choices now might be worth reassessing.

One way to invest in these investment themes is through the SPDR S&P Global Natural Resources ETF (GNR). The fund, evenly divided between the metals & mining, agriculture and energy sectors, is on the rise and can make money for investors.

GNR is weighted by market cap and holds roughly 90 companies in total. The maximum weight of each sub-index is capped at one-third of the index’s total holdings. As the name suggests, GNR offers some global exposure, although the United States is the most represented nation among the portfolio holdings.

This fund has outperformed the S&P over the last year to notch a 19% gain in that period, largely due to a very strong relative performance in 2021. Plus, GNR has an ordinary expense ratio of 0.40% and pays a 2.56% dividend yield. GNR currently holds $1.5 billion in assets.

Chart courtesy of www.StockCharts.com

The fund’s top 10 holdings include BHP Group Ltd. (NYSE:BHP), 5.46%; Exxon Mobil Corp. (NYSE:XOM), 4.72%; Nutrien Ltd. (NYSE:NTR), 4.12%; Chevron Corp. (NYSE:CVX), 3.88%; Total SE (NYSE:TOT), 3.77%; Royal Dutch Shell Plc Class A (NYSE:RDS.A), 2.66%; Vale S.A. Sponsored ADR (NYSE:VALE), 1.63%; UPM-Kymmene Oyj (OTCMKTS:UPMMY), 2.62%; and BP p.l.c. (NYSE:BP), 2.60%. The top 10 holdings make up about one-third of its total assets, as of Feb. 23.

After the United States, consisting of 32.80% of the fund’s portfolio, the countries most represented among GNR’s holdings are: the United Kingdom, 13.27%; Canada, 11.30%; Australia, 10.67%; Finland, 5.11%; France, 4.54%; Brazil, 2.94%; Russia, 2.92%; Japan, 2.26%; and Norway, 1.77%%.

For investors looking for a convenient way to hold some of the biggest and best in global natural resource companies, SPDR S&P Global Natural Resources ETF (GNR) provides an uncomplicated way to add the sector to your portfolio.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Intelligence Report, Investing Edge, the Bullseye Stock Trader, and The Deep Woods (formerly the Weekly ETF Report). His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.