SDCI has demonstrated robust performance, significantly outperforming its peers over the past year with a gain of over 20%, and has a high momentum rating. The fund's methodology selects 14 commodities each month from a universe of 27 by choosing those with the greatest backwardation (or least contango), essentially betting on a 'normalization.' The fund's primary advantage for retail investors is its structure, which allows it to issue a standard Form 1099 instead of the more complex K-1 form.
Market wildcards like tariffs and geopolitical tensions continue to keep investors cautiously optimistic. To help quell that market uncertainty, it's an opportune time to get commodities exposure via one strong-performing ETF: the USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund (SDCI).
The past few years have seen a notable acceleration in commodity price cycles. Research from the World Bank shows that since the onset of the COVID-19 pandemic, full commodity cycles have nearly halved in length — driven by global disruptions ranging from geopolitical conflicts to extreme weather events.
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The fund is an investment vehicle that primarily aims to replicate the performance of the commodities markets. It achieves this by investing in its wholly-owned subsidiary, which shares the same investment goal and is managed by an Adviser and a sub-adviser. The objective of the fund is to mirror the returns of the SummerHaven Dynamic Commodity Index Total ReturnSM, which is a broad market gauge for the commodity sector. The focus of this fund is on providing investors with substantial economic exposure to commodities, and unlike many investment funds, it is non-diverse, concentrating its investments to closely follow the commodities market performance.