United States Commodity Funds debuts Agriculture ETF (USAG)

Apr 13th, 2012 | By | Category: Commodities

United States Commodity Funds, a sponsor of exchange traded commodity funds, has rolled out the United States Agriculture Index Fund (USAG), an ETF providing directional exposure to agricultural futures.

United States Commodity Funds debuts Agriculture ETF (USAG)

USCF has announced the debut of the United States Agriculture Index Fund (USAG), a rules-based ETF tracking agricultural futures.

The United States Agriculture Index Fund seeks to track the daily performance of the SummerHaven Dynamic Agriculture Index Total Return (SDAI), which in turn reflects the performance of a portfolio of agriculture futures contracts fully collateralised with US Treasury Bills.

The SDAI index is comprised of a group of 14 agricultural commodities currently traded on the ICE Futures, CBOT, KCBT and ICE Canada exchanges.

The index uses fundamental signals about underlying physical markets to create an active rules-based benchmark which attempts to maximise backwardation and minimise contango while using contracts in the liquid portions of the futures curve.

The index’s creator, SummerHaven Index Management, is an experienced developer of commodities indices focused on providing investors with better risk-adjusted returns than traditional commodity index benchmarks.

SummerHaven’s principals include K. Geert Rouwenhorst, an academic who is one of the authors of widely cited research on commodities futures investing, including “Facts and Fantasies about Commodity Futures” and “Fundamentals of Commodities Futures Returns”.

The United States Agriculture Index Fund comes with a management expense ratio of 0.95% and is listed on the New York Stock Exchange Arca (NYSE Arca).

Below are the 14 eligible agriculture futures contracts that may comprise the Agriculture Index on a monthly basis:

Soybeans Soybean Meal Cotton
Corn Canola Live Cattle
Soft Red Winter Wheat Sugar Feeder Cattle
Hard Red Winter Wheat Cocoa Lean Hogs
Soybean Oil Coffee

For the current month of April, the Benchmark component futures contracts are:

Soybeans NOV 12 Corn DEC 12 Wheat (CBOT) SEP 12
Cotton No. 2 JUL 12 Sugar #11 JUL 12 Coffee JUL 12
Soybean Oil JUL 12 Live Cattle JUN 12 Feeder Cattle MAY 12
Cocoa JUL 12 Lean Hogs AUG 12 Hard Red Winter Wheat (KCB) JUL 12
Canola JUL 12 Soybean Meal OCT 12

United States Commodity Funds is registered with the CFTC as a commodity pool operator and has approximately $3.1 billion in assets under management as of 30 March, 2012

 

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