Commodity

For wealth managers

Parametric's Commodity Strategy allows investors to achieve greater diversification than traditional commodity benchmarks through rules-based methodologies designed to be intuitive.

A well-diversified portfolio is more than just equities and fixed income. An allocation to commodities helps diversify client portfolios and has historically provided protection during inflationary periods.

Parametric is a 4.7-exempt commodity trading advisor and offers the strategy described in a separately managed account format to investors who meet the definition of a qualified eligible person, as defined by CFTC Regulation 4.7. Parametric serves as a subadvisor to investment products offered and distributed by its affiliate, Eaton Vance Distributors, Inc., a registered broker-dealer. We encourage you to contact your financial advisor.

Investing in a commodity strategy involves risk. All investments are subject to loss. Learn more.

The value of commodity investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, which may include weather, embargoes, tariffs, health, political, international, and regulatory developments. Economic events and other events (whether real or perceived) can reduce the demand for commodities, which may reduce market prices and cause their value to fall. The use of derivatives can lead to losses or adverse movements in the price or value of the asset, index, rate, or instrument underlying a derivative due to failure of a counterparty or to tax or regulatory constraints.

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Why choose Parametric?

$572.1B+

Total firm AUM

$1.7B+

Commodity AUM

197

Investment professionals

Years of equity, derivative, and strategy experience

As of 9/30/2024

How it works

Reweighting
Rebalancing
Collateral

Parametric Commodity aims to avoid concentrations by diversifying across multiple commodity types and sectors, including significant allocations to nonindex commodities. This gives investors access to underrepresented commodities and increased diversification.

Finally, we modify these target weights to reduce unintentional concentrations that might be introduced otherwise.

We maintain target weights and allocations through regular rebalancing. These rebalancing activities exploit the volatility and low correlations of commodities by systematically selling when prices go up and buying when they go down, seeking to harvest a rebalancing alpha.

We avoid risky investments by investing collateral in US Treasury instruments. This arises from the belief that returns should be driven by commodity exposures, not the collateral pool.

Reweighting

Finally, we modify these target weights to reduce unintentional concentrations that might be introduced otherwise.

Rebalancing

Intended benefits of Commodity Strategy

Diversification

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Our Commodity Strategy is highly diversified across commodity types and sectors, including commodities not traditionally included in most indexes.

Exposure

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Our long-only strategy lets investors fully capture the characteristics of the commodity asset class.

Transparency

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Our Commodity Strategy uses an easy-to-understand, rules-based methodology to avoid human bias.

Inflation protection

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Commodity prices have historically responded to inflationary pressures and may help protect investors during inflationary periods.

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More to explore

Commodity

Why choose Parametric?

Diversification

Exposure

Transparency

Inflation protection

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