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Precious Metal ETF (DBP) Hits New 52-Week High

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Invesco DB Precious Metals ETF (DBP - Free Report) is probably on the radar for investors seeking momentum. The fund just hit a 52-week high and has moved up 68.18% from its 52-week low price of $60.08 per share.

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 of where it might be headed.

DBP in Focus

Invesco DB Precious Metals Fund is designed for investors seeking a cost-effective and convenient way to invest in commodity futures. It tracks the DBIQ Optimum Yield Precious Metals Index Excess Return Index, which comprises futures contracts on two of the most important precious metals — gold and silver. The product charges 73 bps in annual fees (See: All Precious Metals ETFs).

Why the Move?

The precious metal market has been an area to watch lately, driven by a rally in both gold and silver prices. Rising expectations of a December interest rate cut by the Fed, a weakening greenback and safe-haven demands are driving the prices of both precious metals.

Additionally, gold benefited from strong central bank purchases, which helped it climb to multi-week highs. Meanwhile, often viewed as both a precious and industrial metal, silver gets additional support from supply constraints and rising demand from industrial applications.

More Gains Ahead?

Currently, DBP has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. However, it might continue its strong performance in the near term, with a positive weighted alpha of 61.64 (per Barchart.com), which gives cues of another rally.


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