Neuberger Berman has launched a commodities fund for UK investors as energy and precious metal prices surge.
The Neuberger Berman Commodities fund will invest in commodity-related derivatives to gain exposure to a broad range of global sectors, including energy, metals, agriculture and livestock.
The new Ucits strategy will be run by senior portfolio manager Hakan Kaya, who is based in New York, supported by five other members of the investment team. Kaya has managed the US-domiciled Neuberger Berman Commodity Strategy since inception.
A factsheet for the $154.8m strategy showed it had 11.3% invested in gold, 7.8% in corn, 7.1% in Brent crude and 6.1% in copper at the end of Q4 2021.
Russia’s war on Ukraine has prompted volatile price swings in the commodity markets through massive supply chain disruptions which have exacerbated rising prices.
Brent crude is currently trading at around $105 a barrel, a high last seen in 2014, while gold, nickel and wheat are also up 40%. However oil prices have taken a hit following president Joe Biden’s unprecedented release of America’s oil reserves in a bid to lower fuel costs.
Kaya said: “We’re seeing scarcity across the commodities complex due to intense supply fragilities coupled with strong demand. This creates largely positive roll yields in the commodities complex while the index has moved into positive roll yield territory, a characteristic that tends to be sticky and can boost existing price momentum.”
The commodities market has also benefited from “huge structural tailwinds” from the green energy transition, he added.
“As political leaders look to meet their net-zero commitments, the demand for commodities will intensify, not only to supply clean energy but also the infrastructure to facilitate this new change.”