This publication brings news of latest product and service launches in the global wealth management industry.

Exchange fund provider WisdomTree Europe – part of US-headquartered investment group WisdomTree – has launched its first commodity ETF, employing a UCITS structure, on the London Stock Exchange.

The fund aims to beat the Bloomberg Commodity Total Return Index over the long term via a mix of exposure to a broad range of commodities and by taking advantage of how commodity futures prices behave, thereby maximising the available yield. The Bloomberg Index is made up of 22 commodities with sector exposures of 35.5 per cent in agriculture, 30.9 per cent in energy, 17 per cent in industrial metals and 15.6 per cent in precious metals.

The ETF has sterling and accumulating share classes.

The ETF is benchmarked against the EBCIWTT, called an “Optimised Roll Commodity Total Return” . The index aims to reduce as much as possible the phenomenon of what is called “contango” and maximising “backwardation”. Commodity futures contracts trade either in contango, where forward month futures contracts trade at a premium to the current month and hence there is a cost (negative roll yield), or in backwardation, where forward month futures contracts trade at a discount to the current month (positive roll yield).

WisdomTree Europe said that its “enhanced roll mechanism” is designed to maximise the roll yield and minimise roll costs related to maintaining exposure to the commodities in the index. This is achieved through a rules based dynamic approach to rolling futures contracts.