abrdn Bloomberg All Commodity Longer Dated Strategy K-1 Free ETF (BCD)

Overview

The abrdn Bloomberg All Commodity Longer Dated Strategy K-1 Free ETF (BCI) seeks to provide investment results that correspond to the performance of the Bloomberg Commodity Longer Dated Total Return Index. It offers exposure to a diversified basket of commodities futures contracts while avoiding the issuance of a K-1 tax form. The ETF aims to provide a tax-efficient way to gain commodity exposure.

Reputation and Reliability

abrdn (formerly Aberdeen Standard Investments) is a well-established asset manager with a global presence and a reputation for providing various investment solutions.

Management Expertise

abrdn has a team of experienced professionals managing commodity and other alternative investment strategies.

Goal

To provide investment results that closely correspond, before fees and expenses, to the performance of the Bloomberg Commodity Longer Dated Total Return Index.

Investment Approach and Strategy

Strategy: The ETF tracks the Bloomberg Commodity Longer Dated Total Return Index, which consists of longer-dated commodity futures contracts. This strategy potentially reduces the negative impact of contango.

Composition The ETF holds a diversified portfolio of commodity futures contracts, primarily in energy, agriculture, and metals.

Market Share: BCI's market share within the broad commodity ETF space is relatively small compared to larger, more established funds.

Total Net Assets (AUM): 85241505

Key Competitors

• Invesco DB Commodity Index Tracking Fund (DBC)
• iShares GSCI Commodity Indexed Trust (GSG)
• Teucrium Agricultural Fund (TAGS)

Competitive Landscape

The commodity ETF market is competitive, with several large players offering broad commodity exposure. BCI's K-1 free structure offers a tax advantage for some investors. However, DBC and GSG have higher AUM and greater liquidity, giving them an edge. TAGS provides exposure to a smaller subset of commodities.

Historical Performance: Historical performance varies based on commodity market cycles. Data for specific periods would be available from financial data providers.

Benchmark Comparison: The ETF aims to track the Bloomberg Commodity Longer Dated Total Return Index. Deviations in performance may occur due to tracking error and fund expenses.

Expense Ratio: 0.29

Average Trading Volume

BCI's average trading volume is moderate, reflecting its smaller size compared to more popular commodity ETFs.

Bid-Ask Spread

The bid-ask spread for BCI can vary depending on market conditions, but it is generally reasonable for an ETF of its size.

Market Environment Factors

Commodity prices are influenced by global economic growth, supply and demand dynamics, geopolitical events, and inflation expectations. These factors significantly impact BCI's performance.

Growth Trajectory

BCI's growth trajectory is tied to investor demand for commodity exposure and its ability to effectively track its benchmark index. Increased awareness of its K-1 free structure could potentially drive growth.

Competitive Edge

BCI's primary competitive advantage is its K-1 free structure, simplifying tax reporting for investors compared to other commodity ETFs that issue K-1 forms. This is particularly attractive to individual investors and some institutions seeking commodity exposure without the added tax complexity. The longer-dated strategy may also reduce the negative impact of contango compared to ETFs holding near-term contracts. However, the longer dated strategy can still be affected by backwardation.

Volatility

Commodity prices are inherently volatile, and BCI's performance reflects this. Investors should expect significant price swings.

Market Risk

BCI is subject to commodity market risk, meaning its value can fluctuate significantly due to changes in commodity supply, demand, and other factors.

Ideal Investor Profile

BCI is suitable for investors seeking diversified commodity exposure in a tax-efficient manner, particularly those who wish to avoid K-1 tax forms. It is also suitable for investors with a higher risk tolerance.

Market Risk

BCI is best suited for long-term investors seeking to diversify their portfolios with commodity exposure or those who believe commodities will outperform other asset classes.

The abrdn Bloomberg All Commodity Longer Dated Strategy K-1 Free ETF (BCI) provides exposure to a diversified basket of commodity futures contracts while offering a K-1 free tax structure. Its longer-dated strategy attempts to mitigate contango effects. While its AUM and trading volume are smaller than some competitors, the tax advantage makes it attractive to specific investors. The ETF's performance is closely tied to commodity market cycles and global economic factors, highlighting potential volatile swings.

• DBC
• GSG
• PDBC
• DJCI

Data Sources:

• abrdn official website
• ETF.com
• Bloomberg
• Morningstar

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Market data is subject to change.