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Coffee ETF (JO) Hits New 52-Week High

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Investors seeking momentum may have iPath Series B Bloomberg Coffee Subindex Total Return ETN (JO - Free Report) on radar now. The fund recently hit a new 52-week high. Shares of JO are up approximately 97.5% from their 52-week low of $34.16/share.

But could there be more gains ahead for this ETF? Let’s take a look at the fund and the near-term outlook to get a better idea of where it might be headed.

iPath Series B Bloomberg Coffee Subindex Total Return ETN

The underlying Bloomberg Coffee Subindex Total Return reflects the returns that are potentially available through an unleveraged investment in the futures contracts on coffee. iPatha.B Coffee Subindex TR ETN charges 45 bps in fees.

Why The Move?

Coffee prices are super-hot lately as a supply crunch from Brazil to Vietnam pushed coffee prices to a seven-year high. Inclement weather, shipping disruptions and rising fertilizer costs are weighing on supplies.

The latest rally came after a decline in certified stockpiles in Brazil. In addition, early projections for Brazil’s 2022 crop indicate that yields will trail the nation’s last high-yielding cycle in 2020-21. That will prevent the rebuilding of stockpiles needed to weather the natural dip in the following harvest’s output.

More Gains Ahead?

The fund has a positive weighted alpha of 80.87. So, there is a decent outlook ahead for those who want to ride this surging ETF a shade further.


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