Commodities: Best Investment of 2019

Commodities: Best Investment of 2019

Hello and welcome to the Morningstar series ask the expert I'm Emma wool and I'm joined today by fund analyst for Morningstar Fatima Kazu to talk about commodities hi farmer hi EEMA so after five very long and hard years for commodities we've had a bit of a rebound in 2019 haven't we yes certainly mates been an interesting year for the commodities sector and we've seen since January which marked low bottom for so many commodities we've seen the sector bounced off strongly from those levels and actually the natural resources related equities have outperformed the broader equity and fixed income markets so far this year so it's been an interesting year so far and then drilling down into those commodities we've got to talk about gold it's an investor favorite how it's gold done in 2016 gold actually has been the star performer this year and there's many reason that explains such strong returns it's predominantly the uncertainty around the global economy this years but also political events and also the diminishing probability of interest rate hikes in the US as you remember at the start of the year the markets priced in full air interest rate hikes in the US and as we go on over the months that probability has diminished and we've saw a flight into that safe haven assets for from many investors and the demand has increased substantially this year and other factor that actually explained that a return of trust from investor is that we've seen many companies in the sector seen their financial states improved significantly from periods in 1213 and that has also helped drove Gold's higher I'm looking then at the couple of couple of days where gold spike we saw gold spike over after brexit and this week we saw the price of gold spiked after the election of Donald Trump for the next u.s.

President what then looking at another commodity at energy because this has been quite a volatile year for the oil price but it has moved up hasn't it yeah energy is another sector that has been continue to make headlines this year and we've seen that downward trend that started in June 14 and we've seen the prices bottom up to below 13 January however we've seen a return or reversed of that trend over the past few months and actually the sector is up this year and there is a lot of factor that have helped on the supply side but also on the demand side the freeze in February announced that OPEC has helped and more recently the announcement by OPEC again to cut production has further helped the sector and the prices in that upward trajectory the demand is also strong and we've seen the production fall in areas as well and all those development have helped the prices in that sector so if investors are still feeling bullish about the commodity sector which funds do we rate highly that can offer them exposure to this space we have a quite a good selection in that area so if investor wants purely exposure to gold equities we have the black Gordon General which is run by an experienced manager in that field with an energy we have a Guinness global energy which is also managed by a highly experienced team and if you if I'm going to investor wish to access this the over complex we very first state global resources which we highly rate as well or TPM global resources which is a more smaller cut fun so that is quite a good selection Fatima thank you very much Thank You Emma this is Emma wolf for Morningstar thank you for watching

Analysis, Analysts, Asset, Bloomberg, Bonds, Business, Cash, Citywire, Data, Economy, Editorial, Equities, Equity, Education, Exchange, Finance, Fool, Funds, Global, Income, Investing, Investment, Ideas, London, Management, Manager, Markets, Money, Motley, Morningstar, Morning, News, Personal, Portfolio, Profit, Research, Star, Stocks, Shares, Technical, Top, Tips, Tools, Trading, UK, Wealth, Warren, Buffett, First, Time, Value, 2019, Fatima Khizou, Olivers yard, gold, energy, commodities, prescious metals, gas, electric