Commodities and especially investments in commodities are currently enjoying a high degree of attention by institutional investors such as pension funds and portfolio managers but an increasing interest in commodities can also be found at retail investors. Unlike bonds, stocks, mutual and exchange traded funds, commodities are real, tangible products and part of people’s everyday life. Even though commodities are essential for our survival, recently commodities as an asset class were part of excessive media coverage, investments in that asset class has become interesting for private investors.
In this Bachelor Thesis I give insight into the commodity sector as an investment opportunity especially for private investors in Germany. I will refrain from presenting the historical development of the physical commodity market, but this work shows the facts about the six most important opportunities provided in the financial market to participate in the development in as Jim Rogers describes it: the world’s best market.
Table of Contents
Table of Figures
List of Abbreviations
1. Introduction
1.1 Price development of selected commodities in 2009
1.2 What happened before 2009?
1.3 Commodities - What is originally meant by that?
1.4 Commodities as an asset class of their own
2. Investing in Commodities
2.1 Why should private investors go into commodities?
2.1.1 Portfolio diversification
2.1.2 Hedging against inflation
2.1.3 Hedging against a foreign exchange risk
2.1.4 Potential for aggressive returns
2.2 How should a private investor invest in commodities?
2.2.1 Direct investment in physical commodities
2.2.2 Commodity Stocks
2.2.3 Derivatives
2.2.3.1 Futures
2.2.3.2 Mini futures:
2.2.3.3 Options
2.2.3.4 Forwards
2.2.4 Certificates
2.2.5 ETCs
2.2.6 Commodity-ETFs
3. Comparison of the investment opportunities for retail investors
3.1 Risk-return profile
3.2 Transaction Costs
3.3 Legal specifics
3.4 Taxation of the investment vehicles
3.5 Holding period and investment target
3.6 Overview pros and cons
4. Summary and Conclusion Investment recommendation:
5. List of references
Bibliography
Working Papers
Newspapers
Online References
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