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Tablas QA
Written by Administrator   
October 01, 2009 10:09 AM EST

 

The Commodity Futures Trading Commission’s effort to clamp down on the role of index investors continues to impact exchange-traded funds.

On Wednesday, Sept. 30, Deutsche Bank announced that the PowerShares DB Commodity Index Tracking Fund (NYSEArca: DBC) and PowerShares DB Agricultural Commodity Index Fund (NYSEArca: DBA) would massively diversify the type and number of commodity futures they hold.

DBC and DBA are two of the most popular commodity ETFs in the world, with $3.4 billion and $2.2 billion in assets, respectively. The funds until now have held concentrated positions in a select number of commodity futures: six for DBC and four for DBA.

But with the CFTC threatening to enact position limits on a broad range of commodity futures—and with its recent decision to enforce existing position limits on agricultural futures for ETFs—Deutsche Bank has decided that the time is right to spread its bets.

The moves will not alter the sector-level distribution in DBC; DBA, however, will make a significant move into livestock, taking on a 25% position in cattle and hogs.

The changes in the portfolios will take place between Oct. 19 and Oct. 31. The old and new index weights are listed below.

 

Old DBC

New DBC

Commodity

Weight

Commodity

Weight

WTI Crude

35.00%

WTI Crude

12.38%

Heating Oil

20.00%

Brent Crude

12.38%

Gold

10.00%

Heating Oil

12.38%

Aluminum

12.50%

RBOB Gasoline

12.38%

Corn

11.25%

Natural Gas

5.50%

Wheat

11.25%

Gold

8.00%

 

Silver

2.00%

Aluminum

4.17%

Zinc

4.17%

Copper Grade A

4.17%

Corn

5.63%

Wheat

5.63%

Soybeans

5.63%

Sugar

5.63%

 

Old DBA

New DBA

Commodity

Weight

Commodity

Weight

Corn

25.00%

Corn

12.50%

Wheat

25.00%

Soybeans

12.50%

Soybeans

25.00%

Wheat

6.25%

Sugar

25.00 %

Kansas Wheat

6.25%

 

Sugar

12.50%

Cocoa

11.11%

Coffee

11.11%

Cotton

2.78%

Live Cattle

12.50%

Feeder Cattle

4.17%

Lean Hogs

8.33%

 



 

 
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