Eugen Weinberg, head of commodity research at Commerzbank, presented the Commerzbank Commodity Strategy fund, to which he is an advisor, to delegates at Investment Europe's recent forum in Lausanne. The markets it invests in typically face demand higher than supply, with China the primary driver.
The process for managing the fund involves first an assessment of the macroeconomic / political situation, a fundamental and technical review of the commodities markets, and risk analysis, to produce an allocation decision between commodities and money market exposure.
The team then conducts a fundamental and technical review of commodity segments and of individual commodities, a comparison of the relative attractiveness of individual commodities, and risk assessment and consideration of investment guidelines, to determine weightings of commodity segments, as well as of individual commodities.
Finally, it also assess the attractiveness of further commodity investments, a risk assessment and consideration of investment guidelines, to come to a decision about further commodity investments.
By September the fund had 42% of its allocation to commodities in precious metals including 12.8% in gold; 27.3% in industrial metals including 6.85% in copper; 19.7% in oil; and 0.7% in natural gas.