Teucrium Soybean (SOYB)

Overview

The Teucrium Soybean Fund (SOYB) seeks to provide investors with exposure to the daily changes in percentage terms of a weighted average of the closing prices for three futures contracts for soybeans. It is designed for investors who want a convenient way to invest in soybean futures without directly managing futures accounts.

Reputation and Reliability

Teucrium Trading, LLC specializes in commodity-based ETFs, known for their expertise in this niche market. They have a proven track record of managing commodity-based funds.

Management Expertise

Teucrium's management team has specialized knowledge in commodity futures markets and exchange-traded products, which is crucial for managing the complexities of commodity ETFs.

Goal

The fund's goal is to reflect the daily changes in percentage terms of a weighted average of the closing prices for three actively traded contracts for soybeans.

Investment Approach and Strategy

Strategy: The ETF uses a futures-based strategy. It invests in front-month, second-month, and third-month soybean futures contracts, aiming to capture the price movements of soybeans.

Composition The ETF holds soybean futures contracts as its primary assets. The allocation is weighted across different contract expiration months to mitigate some of the impact of rolling futures.

Market Share: SOYB's market share is significant, but is not the total market share and varies with competing funds, supply, and investor interest.

Total Net Assets (AUM): 67126285

Key Competitors

• Invesco DB Agriculture Fund (DBA)
• iPath Series B Bloomberg Agriculture Subindex Total Return ETN (JJA)

Competitive Landscape

The competitive landscape for soybean ETFs is somewhat limited, with Teucrium being the predominant market share holder. SOYB specializes specifically in Soybean Futures, giving it an advantage for investors solely focused on Soybeans. Competitors such as DBA and JJA, offering broader agricultural exposure, might be preferred by investors looking for portfolio diversification.

Historical Performance: Historical performance is highly correlated with soybean futures prices. Returns can be volatile depending on supply and demand factors, weather patterns, and global trade dynamics.

Benchmark Comparison: The ETF's performance is benchmarked against an index comprised of soybean futures contracts. Tracking error can occur due to the costs of rolling futures contracts.

Expense Ratio: 1.15

Average Trading Volume

SOYB's average trading volume is adequate, allowing for relatively easy entry and exit for most investors.

Bid-Ask Spread

The bid-ask spread is generally tight, reflecting adequate liquidity, but can widen during periods of market volatility or lower trading activity.

Market Environment Factors

Economic indicators (e.g., inflation, interest rates), planting and harvest reports, export demand, and weather patterns significantly impact soybean prices. Geopolitical events and trade policies also play a critical role.

Growth Trajectory

The growth trajectory of SOYB is tied directly to the underlying commodity's performance. Changes in strategy are infrequent but may occur to optimize futures contract selection or mitigate risks.

Competitive Edge

SOYB offers specialized exposure to soybean futures, appealing to investors who want targeted commodity investments. Teucriumu2019s expertise in managing commodity-based ETFs is a key advantage. The fund's structure, using actively managed futures contracts, allows for flexibility in navigating market conditions. This niche focus can result in better alignment with soybean price movements compared to broader agricultural ETFs. However, it also means that the fund's performance is highly dependent on soybean market dynamics.

Volatility

SOYB is considered a volatile investment due to the inherent price fluctuations in commodity futures markets.

Market Risk

Specific risks include adverse weather conditions affecting crop yields, changes in government agricultural policies, and fluctuations in global demand for soybeans. Counterparty risk is also present with futures contracts.

Ideal Investor Profile

The ideal investor is knowledgeable about commodity markets, understands the risks associated with futures contracts, and seeks a tool for short-term tactical trading or hedging purposes.

Market Risk

SOYB is generally more suitable for active traders or those using it for hedging purposes rather than long-term passive investors due to volatility.

The Teucrium Soybean Fund provides a focused way to invest in soybean futures, suitable for those seeking short-term exposure or hedging strategies. Its performance is highly correlated with soybean prices, making it volatile and riskier than diversified equity funds. The fund benefits from Teucriumu2019s expertise in commodity ETFs, but investors should be aware of the costs associated with rolling futures contracts. While it's a focused investment, its reliance on a single commodity exposes investors to various market risks, making it more suitable for experienced and informed traders.

Data Sources:

• Teucrium Funds Website
• ETF.com
• Morningstar
• Bloomberg

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. Investments in ETFs are subject to market risk, including the potential loss of principal.