It was a pretty hectic year for agricultural commodities as the summer months wreaked havoc on prices. After the United States endured the hottest 12-month span on record and an abysmal drought, a number of these staple commodities experienced big movements in price and trading volume alike. But now that 2012 is nearing its close, we look back at these funds throughout the course of the year to see which funds outperformed the rest [for more agriculture news and analysis subscribe to our free newsletter].
It’s always nice to see a smaller fund outdo its largest competitors, as the iPath Pure Beta Grains (NYSEARCA:WEET) has just $2.7 million in assets. WEET tracks an index that is comprised of a basket of grains futures in an attempt to mitigate the impact of contango. The strategy has worked beautifully this year, as iPath Pure Beta Grains (NYSEARCA:WEET) comes in as the top performer, jumping just over 23% for the year. Note that the fund experienced an enormous rally in June/July and has simply held its levels from there.
Another in the line of iPath’s Pure Beta products, the iPath Pure Beta Agriculture (NYSEARCA:DIRT) applies a similar methodology to WEET, but spreads it out to a few more ag contracts beyond the grains. iPath Pure Beta Agriculture (NYSEARCA:DIRT), which has just $3.2 million in assets, surged by 15.6% on the year, ousting competitors like RJA and PowerShares DB Agriculture Fund (NYSEARCA:DBA) with ease. It appears that there might be something to this “Pure Beta” strategy, despite the minimal attention it has received from investors thus far. Perhaps these strong performances will be enough to garner more interest [see also 50 Ways To Invest In Agriculture].