While Technology and Artificial Intelligence(AI) has certainly been front and center this year, one of the areas often overlooked by traders and that we’ve been bullish on from a macro perspective is commodities. We have specifically highlighted Base/Precious metals in that asset class.
From persistent inflationary pressures to global growth in developed and emerging markets, a desire for a tangible backed asset in geo-political uncertainty, etc., both metals have been outperforming and underallocated in many investment portfolios.
One company that should benefit from this demand for metals is mining company Freeport-McMoRan (FCX).
Here we can see Copper & Gold Futures, along with the Base (DBB) and Precious Metal (DBP) funds really start to all get going in early February, and Freeport-McMoRan correlating and then following suit as well.
From a portfolio and risk correlation perspective, Freeport- McMoRan has a high correlation with both the Base (DBB) and Precious (DBP) funds:
The Bottom Line:
If the demand for Copper/Gold Futures and Base and Precious metals continues to rise, our big pick to follow them is Freeport-McMoRan (FCX)
FCX is one company worth keeping an eye on!
Cheers,
JB & Serge
