Allocating to commodity ETFs can strengthen traditional portfolios by providing exposure to essential, real-world assets, such as precious metals, energy, and agriculture. Because commodity returns have historically shown low correlation to equities and fixed income, they can offer differentiated sources of return and help moderate portfolio volatility.
In an environment shaped by inflation pressures, geopolitical uncertainty, and structural shifts in global demand, commodities can play a meaningful role in building more resilient portfolios.
Why invest in commodities
Return profile distinction
Commodities often move differently from stocks and bonds, reflecting supply constraints, weather patterns, changing trade patterns, and global demand rather than corporate earnings or interest rates. We believe this distinct return profile can enhance diversification and support more balanced portfolio outcomes over time.
Resilience across market cycles
From inflationary periods to supply disruptions and geopolitical shocks, commodities have historically helped investors navigate episodes of market stress. We believe a strategic, long-term allocation – rather than purely tactical positioning – can support investors' risk management and return potential across market cycles.
Participation in global trends
Commodities sit at the center of long-term global themes, including the energy transition, infrastructure investment, and the growth of data centers and artificial intelligence. We believe a diversified commodity allocation provides access to these trends across multiple sectors – beyond just precious metals.
Why Aberdeen Investments for commodities
Deep expertise
With decades of combined experience across alternative investments, our team delivers disciplined, data-driven research to help investors understand the evolving dynamics of commodity markets and make informed allocation decisions.
Accessible solutions
Our commodity ETFs are designed for efficient portfolio integration, offering broad market exposure, cost awareness, and transparency – so investors can implement strategies with clarity and confidence.
Long-term partnership
We support advisors and commodity investors through ongoing education, market insights, and portfolio guidance. Our focus is not only on providing access to commodities, but on helping clients use them thoughtfully and effectively over time.
Funds in focus
abrdn Physical Gold Shares ETF
SGOL
abrdn Physical Palladium Shares ETF
PALL
abrdn Physical Platinum Shares ETF
PPLT
abrdn Physical Precious Metals Basket Shares ETF
GLTR
abrdn Physical Silver Shares ETF
SIVR
abrdn Bloomberg All Commodity Longer-Dated Strategy K-1 Free ETF
BCD
abrdn Bloomberg All Commodity Strategy K-1 Free ETF
BCI
Commodities FAQs
Commodities are raw materials or primary goods such as crude oil, natural gas, gold, silver, wheat, and corn that are produced or extracted and traded in global markets. They are essential building blocks of the world’s economy, used to produce energy, food, and consumer products. Commodities are generally grouped into major categories: energy (oil, gas), metals (including precious metals like gold and silver, as well as industrial metals like copper), and agricultural products (crops, livestock, etc.). Their prices are determined by worldwide supply and demand and can fluctuate based on factors like weather, geopolitical events, and market needs. In the context of investing, commodities are considered a distinct asset class. Investors can invest in commodities directly (for example, by buying physical gold or trading commodity futures contracts) or indirectly through financial instruments like commodity ETFs and mutual funds, which make commodities investing more accessible without requiring investors to manage the physical goods.
Investors often invest in commodities for several key reasons: diversification, inflation protection, and exposure to global economic trends. Commodity prices tend to move differently from traditional assets like stocks and bonds, so adding commodities to a portfolio can reduce overall risk and improve diversification. For example, during periods when stock or bond markets are down, commodities might hold their value or even rise, helping to stabilize investment returns. Many commodities – particularly precious metals such as gold and silver – also serve as inflation hedges, meaning they often increase in value when inflation is high, or currencies are losing purchasing power. This makes them useful for preserving wealth during times of rising prices or economic uncertainty. Additionally, commodities investing allows investors to benefit from supply-and-demand trends in the global economy; if demand for energy, metals, or agricultural products grows, commodity prices can appreciate accordingly. To capture these benefits, investors use various avenues such as commodity futures or commodity ETFs to gain exposure. These investment vehicles (including commodity index ETFs that track broad benchmarks like the Bloomberg Commodity Index) provide a convenient way to participate in the commodities market without having to buy and store physical materials.
In an investment context, broad commodities refers to a diversified basket of commodities across multiple sectors of the natural resources market. Instead of focusing on a single type of commodity (such as only oil or only gold), broad commodities exposure covers a wide range of commodity categories – typically including energy products, industrial metals, precious metals (like gold and silver), and agricultural goods combined into one comprehensive group or index. A common example is the Bloomberg Commodity Index, a well-known broad commodity benchmark that tracks a wide mix of commodities from energy to metals to agriculture. Investors who want exposure to broad commodities often choose commodity index ETFs or mutual funds that mirror these broad indexes. Such investments allow individuals to conveniently invest in commodities across the board with a single holding, providing instant diversification within the commodities asset class.
Precious metals investments are popular because assets like gold and silver have historically acted as safe-haven stores of value and reliable hedges against inflation. Investors often add precious metals (such as gold, silver, platinum, and palladium) to their portfolios to help preserve wealth during economic uncertainty. These metals tend to hold their value or even appreciate when paper currencies weaken or when stock markets are volatile, making them a useful tool for financial stability. Precious metals also offer diversification benefits, since their prices usually move independently of stocks and bonds; this low correlation can help reduce overall portfolio risk. Additionally, gold and silver have intrinsic value and global demand (for uses in jewelry, technology, and industry), which supports their long-term appeal. Many individuals focus on gold investing and silver investing specifically to capitalize on these characteristics. Investors can gain exposure to precious metals by purchasing physical bullion or coins, buying shares of mining companies, or investing through precious metals ETFs (funds that hold physical gold, silver, or a basket of precious metals). These financial products make it easy to participate in the precious metals market and enjoy the potential benefits of this unique commodity segment without having to buy and store the metals directly.