Sumit Roy: Investors ran—not walked—away from commodity-related investments this week, as over the past five sessions, the S&P GSCI Index fell the most since 2008. We saw silver plunge over 30 percent in a matter of days, while crude oil crumbled by almost $10/barrel in a single session.
Rather than any single news or economic event, the primary culprit seemed to be an unwinding of the extremely crowded trade in commodities. This exodus from commodities was very much evident in this week’s ETP flows data, which shows that investors pulled out a whopping $3.4 billion from the space. After including losses from capital depreciation, total assets in commodity-related ETPs fell a stunning $15 billion over the course of the week, ending at $164 billion.
Four of the five sectors saw investor withdrawals. Precious metals, unsurprisingly, led with $2 billion in outflows. The energy, agriculture and broad market sectors followed with $1.1 billion, $193 million and $71 million in outflows, respectively. Industrial metals ETPs bucked the trend, managing to attract $25 million of investor capital, despite the poor performance in base metals prices during the week.
Individual ETP performance mirrored sector performance, with precious metals and energy funds dominating the action. Once again, we saw the ProShares UltraShort Silver (NYSE:ZSL) make the top inflows leaderboard, this time taking the top spot, with $138 million in inflows. Assets into this leveraged short product have ballooned from $118 million to $694 million over the past month, as traders sought to time the top in silver prices.
Interestingly, the iShares Gold Trust (NYSE:IAU) and the PowerShares DB Precious Metals Fund (NYSE:DBP) also made the inflows leaderboard this week, as investors added $94 million and $62 million, respectively, to the funds. IAU offers long exposure to physical gold, while DBP invests in gold and silver futures contracts.
Finally, the PowerShares DB Energy Fund (NYSE:DBE) and the Alerian MLP ETF (NYSE:AMLP) round out the top five, with $33 million and $27 million in inflows, respectively. The latter has been attracting a steady stream of capital, as investors consider high-yield master limited partnerships a conservative way to gain energy exposure.
Turning to the outflow leaders this week, the two behemoths in the precious metals space—the SPDR Gold Trust (NYSE:GLD) and the iShares Silver Trust (NYSE:SLV)—saw enormous investor withdrawals, of $1 billion and $1.1 billion, respectively. GLD’s performance contrasts with that of lower-cost rival IAU mentioned above, but it’s more in line with what we would expect, given the downward trajectory of gold prices this week. SLV was the big story of the week though, as the outflows from the fund offer a strong explanation for why silver prices plummeted in the period.
Meanwhile, United States Natural Gas Fund (NYSE:UNG) saw big moves of its own, as investors pulled out $220 million from the fund. Rounding out the top five, the PowerShares DB Agriculture Fund (NYSE:DBA) lost $179 million of investor capital.
Switching gears and taking a look at price performance for the week, we see that not a single ETP posted a positive return in the period. The iPath Pure Beta Aluminum ETN (NYSE:FOIL) fared the best, as it lost only 0.02 percent.
As for the worst price performers of the week, every product was silver-related. The UBS E-TRACS CMCI Silver Total Return ETN (NYSE:USV), PowerShares DB Silver Fund (NYSE:DBS), iShares Silver Trust (NYSE:SLV), ETFS Physical Silver Shares (NYSE:SIVR) and ETFS Physical White Metals Basket Shares (NYSE:WITE) saw losses of 30.82 percent, 28.95 percent, 28.65 percent, 28.63 percent and 21.18 percent, respectively.
Fund Flows Data: April 29 – May 5, 2011
Commodity ETF Weekly Flows By Asset Class
|% of AUM|
Top 5 Commodity ETF Creations
|AUM % Change|
|(ZSL)||ProShares UltraShort Silver||138.11||694.35||24.83%|
|(IAU)||iShares Gold Trust||94.46||6,624.29||1.45%|
|(DBP)||PowerShares DB Precious Metals||61.64||584.05||11.80%|
|(DBE)||PowerShares DB Energy||32.86||248.84||15.21%|
Top 5 Commodity ETF Redemptions
|AUM % Change|
|(XLE)||Energy Select SPDR||-558.39||9,134.14||-5.76%|
|(UNG)||United States Natural Gas||-219.76||1,865.88||-10.54%|
|(DBA)||PowerShares DB Agriculture||-178.94||3,453.95||-4.93%|
Top 5 Weekly Performers (Excluding Leverage/Inverse, >1,000 Shares Traded)
|(FOIL)||iPath Pure Beta Aluminum ETN||-0.02%||21,700||4.43|
|(UBG)||UBS E-TRACS CMCI Gold Total Return ETN||-0.15%||13,679||7.46|
|(HEVY)||iPath Pure Beta Industrial Metals ETN||-0.66%||12,800||4.67|
|(CUPM)||iPath Pure Beta Copper ETN||-1.31%||16,500||4.70|
|(NUCL)||iShares S&P Global Nuclear Energy||-1.37%||19,418||17.68|
Bottom 5 Weekly Performers (Excluding Leverage/Inverse, >1,000 Shares Traded)
|(USV)||UBS E-TRACS CMCI Silver Total Return ETN||-30.82%||102,649||9.23|
|(DBS)||PowerShares DB Silver||-28.95%||3,433,154||367.99|
|(SIVR)||ETFS Physical Silver||-28.63%||19,082,252||673.72|
|(WITE)||ETFS Physical WM Basket||-21.18%||844,064||58.46|
Top 5 Volume Surprises (>$50mm AUM)
|1 Week Average Volume||% of Average|
|(JO)||iPath Dow Jones-UBS Coffee Total Return ETN||88,734||2,803,363||631.86%|
|(JJA)||iPath Dow Jones UBS Agriculture Total Return ETN||160,437||3,883,216||484.08%|
|(PSAU)||PowerShares Global Gold and Precious Metals Portfolio||9,948||226,931||456.26%|
|(GSC)||GS Connect S&P GSCI Enhanced Commodity Total Return Strategy ETN||14,324||254,297||355.07%|
|(GLTR)||ETFS Physical Precious Metal Basket Shares||73,880||1,283,580||347.48%|
Disclaimer: Data provided by IndexUniverse. All data as of 6 a.m. Eastern the date of publication. Data is believed to be accurate; however, transient market data is often subject to subsequent revision and correction by the exchanges.
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