For investors seeking momentum, iPath Bloomberg Aluminum Subindex Total Return ETN is probably on radar now. The fund just hit a 52-week high and is up about 24% from its 52-week low price of $16.22/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:
JJU in Focus
This ETN follows the Bloomberg Aluminum Subindex Total Return, which delivers returns through an unleveraged investment in the futures contracts on aluminum. The ETN has been able to manage $3 million in AUM and has 0.75% in expense ratio (see: all the Industrial Metal ETFs here).
Why the Move?
Aluminum has been a commodity to watch lately given the impressive surge in its prices this week after the United States slapped tough new sanctions on Rusal, a leading metal producer controlled by Russian oligarch Oleg Deripaska. Notably, Rusal produces 7% of the world's aluminum, according to the U.S. Treasury.
More Gains Ahead?
Currently, JJU has a Zacks ETF Rank #4 (Sell) with a High risk outlook, suggesting that the outperformance is unlikely to continue in the months ahead. However, the fund seems to remain strong given a high weighted alpha of 19.80% but with high 20-day volatility of 28.40%. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.
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