Crude oil investors should take a look at this ETF, probably the best to buy right now.
There is an ETF that has exceeded all expectations, recording an extraordinary performance of 250% over the last three years, and is one of the best to invest in right now.
The product has captured the attention of investors with its extraordinary run. Let’s see how and why it achieved such exceptional results, exploring its structure, its risk and what are the important considerations to be made in the case of investors interested in entering the world of energy raw materials.
Why this ETF is the best to buy right now
The WisdomTree Brent Crude Oil ETF is a passively managed ETF that offers investors the opportunity to participate in the Brent crude oil market through the Bloomberg Brent Crude Index. This ETF is a popular tool for those looking to expose their portfolio to the energy commodities sector, particularly oil.
This ETF is managed by WisdomTree and has considerable assets under management, amounting to €2,048 million (2,19 billion USD). It was launched on 9 January 2012 and is domiciled in Jersey. With a total expense ratio (TER) of 0.49% per annum, WisdomTree Brent Crude Oil offers a reasonable cost for investors interested in tracking Brent oil.
The ETF uses a synthetic replication structure based on a swap to derive the performance of the underlying index, Bloomberg Brent Crude. This means that the fund does not physically hold the oil, but instead uses financial instruments such as swaps to achieve its investment objective. This structure may involve a certain degree of risk.
Performance Overview
The historical performance of the WisdomTree Brent Crude Oil ETF is an important aspect for investors to consider. Over the past few years, the ETF has proven to be a volatile product, as evidenced by an annual volatility of 28.75%. However, it is important to note that commodities, including oil, are notoriously subject to significant price swings, which can impact ETF volatility.
Over the last five years, the ETF has recorded a total return of 76.11%, which reflects the performance of Brent oil during this period. It should be noted that the return can vary greatly depending on market conditions, and the ETF has also seen negative returns in the past, as evidenced by the annual return of -11.03% over the past year.
Risks and Returns
The WisdomTree Brent Crude Oil ETF offers an investment opportunity in the oil sector, but it is important to understand the associated risks. The maximum drawdown since the fund’s launch was -82.98%, which indicates the possibility of significant losses under certain market conditions. Furthermore, the annual volatility of 28.75% suggests that the ETF may see noticeable price swings in the near term.
However, it is also important to note that the ETF has demonstrated the ability to generate significant long-term returns, as evidenced by its overall return of 250.29% over the past three years. This suggests that the ETF could be an attractive choice for long-term investors looking to expose their portfolio to the oil sector.
leggi anche
The best inflation-protected ETFs in 2024
Conclusion
The WisdomTree Brent Crude Oil ETF offers investors an investment opportunity in the energy commodities sector, specifically Brent Crude Oil, but it is important to note that the ETF is subject to volatility and may involve significant risks. Investors should carefully evaluate their risk profile and investment objectives before considering this fund.
Its synthetic replication structure via a swap offers greater flexibility in portfolio management, but may also involve additional risks. Overall, the WisdomTree Brent Crude Oil ETF could be an appropriate choice for investors who wish to diversify their portfolio with exposure to Brent oil, but it is essential to be aware of the risks associated with this type of investment.
| Disclaimer The information and considerations contained in this article should not be used as the sole and principal basis on which to make investment decisions. The reader maintains full freedom in his own investment choices and full responsibility in making them since he alone knows his risk appetite and his time horizon. The information contained in the article is provided for informational purposes only and its disclosure does not constitute and should not be considered an offer or solicitation for public savings. |
Original article published on Money.it Italy 2023-11-07 17:04:05. Original title: Rendimenti stellari per questo ETF, +250% in 3 anni
