Aluminum Commodity

Aluminum commodity ETFs and mutual funds invest the majority of their assets... Aluminum commodity ETFs and mutual funds invest the majority of their assets in physical aluminum or aluminum futures contracts. These funds aim to provide exposure to investors who believe the price of aluminum is heading higher. Aluminum commodity ETFs and mutual funds tend to be passively managed. One common type of aluminum commodity fund invests in the physical metal itself. These funds store metal in secure vaults on behalf of investors. Other aluminum commodity funds only own aluminum futures contracts. These are derivatives that are tied to the price of aluminum. Aluminum futures usually move in lockstep with the price of physical aluminum, but there can be times when it’s more profitable to own futures than physical, and vice versa. Investors are attracted to aluminum because it’s a base metal that may do well when economic growth is strong. Aluminum is used in consumer packaging, as well as more advanced industrial applications. The aluminum market is one of the largest base metals markets. However, investor purchases and sales of aluminum can still have a large impact on the price. Accordingly, these are only appropriate for investors willing to take on considerable risk. Last Updated: 04/26/2024 View more View less

Aluminum commodity ETFs and mutual funds invest the majority of their assets in physical aluminum or aluminum futures contracts. These funds aim to provide exposure to investors who believe the price of aluminum... Aluminum commodity ETFs and mutual funds invest the majority of their assets in physical aluminum or aluminum futures contracts. These funds aim to provide exposure to investors who believe the price of aluminum is heading higher. Aluminum commodity ETFs and mutual funds tend to be passively managed. One common type of aluminum commodity fund invests in the physical metal itself. These funds store metal in secure vaults on behalf of investors. Other aluminum commodity funds only own aluminum futures contracts. These are derivatives that are tied to the price of aluminum. Aluminum futures usually move in lockstep with the price of physical aluminum, but there can be times when it’s more profitable to own futures than physical, and vice versa. Investors are attracted to aluminum because it’s a base metal that may do well when economic growth is strong. Aluminum is used in consumer packaging, as well as more advanced industrial applications. The aluminum market is one of the largest base metals markets. However, investor purchases and sales of aluminum can still have a large impact on the price. Accordingly, these are only appropriate for investors willing to take on considerable risk. Last Updated: 04/26/2024 View more View less