Standard Life Aberdeen – now called “abrdn” – is widening out its list of commodity ETFs, listing an industrial metals ETF to complement its precious metals ETFs.
The abrdn Bloomberg Industrial Metals Strategy K-1 Free ETF (BCIM), which will trade on NYSE, will track the Bloomberg Industrial Metals Total Return Sub- index.
The Sub-index follows the futures markets for aluminium, copper, nickel, and zinc. The index is called “total return” because it includes the interest that investors earn on the cash they post as margin when buying the commodities futures.
The futures are weighted based on liquidity and production. Meaning that metals that are more heavily produced with more liquid futures should get more weight. Futures are then rolled every 1 – 3 months.
The prices of industrial metals have surged this year as the world recovers from the covid-19 pandemic. Nickel and zinc have been helped by the rise of electric vehicles, as they are used to make batteries used in cars.
Aluminium prices have hit 10-year highs, as demand for beer cans and construction material surges. The aluminium price has driven up the share prices of aluminium producers such as Alcoa and Norsk Hydro.
BCIM will be structured as a ‘K-1 Free’ commodities ETFs, meaning the fund uses a Cayman Islands subsidiary as a way of optimising taxes.
The fund charges 0.39%.
Bernie’s commentary – I’m really struggling with “abrdn” rebranding
When I saw this new ETF was listing, I couldn’t concentrate on it. Instead, I was distracted by Aberdeen’s new branding and company name. Earlier this year Standard Life Aberdeen changed its name to abrdn, all lower-case letters and no vowels. And changed its logo to the image at the top of this article.
The Motley Fool publication said the rebrand was like “a lost middle-aged man trying to reinvent himself as hip, young and cool to recapture the popularity and vigour of his younger days”. Abrdn’s share price has fallen 25% since the rebrand.
I’m trying to focus on this new ETF, which actually looks quite clever but my eyes keep wandering to this rebranding.
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