For investors seeking momentum, Invesco DB Base Metals ETF (DBB - Free Report) is probably on radar. The fund just hit a 52-week high and is up 38.5% from its 52-week low price of $18.04/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
DBB in Focus
The underlying DBIQ Optimum Yield Industrial Metals Index Excess Return Index is a rules-based index composed of futures contracts on some of the most liquid and widely used base metals like aluminum, zinc and copper. It is intended to reflect the performance of the industrial metals sector. The ETF charges 77 basis points in annual fees.
Why the Move?
The disruptive metals industry is benefiting from the Russia-Ukraine crisis. Ukraine is a major producer of uranium, titanium, iron ore, steel, and ammonia too. And the country’s steel makes up around 10% of Europe’s imports.
As the conflict worsens with harsh sanctions being imposed on Russia by the West, counter sanctions are likely in the coming days. These could hit supply chains and make commodity market soaring, sending inflation higher.
More Gains Ahead?
Currently, DBB has a Zacks ETF Rank #3 (Hold). Therefore, it is hard to get a handle on its future returns one way or the other. DBB has a positive weighted alpha of 35.52 (per barchart.com), which gives cues of further rally.
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For investors seeking momentum, Invesco DB Base Metals ETF (DBB - Free Report) is probably on radar. The fund just hit a 52-week high and is up 38.5% from its 52-week low price of $18.04/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
DBB in Focus
The underlying DBIQ Optimum Yield Industrial Metals Index Excess Return Index is a rules-based index composed of futures contracts on some of the most liquid and widely used base metals like aluminum, zinc and copper. It is intended to reflect the performance of the industrial metals sector. The ETF charges 77 basis points in annual fees.
Why the Move?
The disruptive metals industry is benefiting from the Russia-Ukraine crisis. Ukraine is a major producer of uranium, titanium, iron ore, steel, and ammonia too. And the country’s steel makes up around 10% of Europe’s imports.
As the conflict worsens with harsh sanctions being imposed on Russia by the West, counter sanctions are likely in the coming days. These could hit supply chains and make commodity market soaring, sending inflation higher.
More Gains Ahead?
Currently, DBB has a Zacks ETF Rank #3 (Hold). Therefore, it is hard to get a handle on its future returns one way or the other. DBB has a positive weighted alpha of 35.52 (per barchart.com), which gives cues of further rally.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
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