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Invesco's Kriskey on Copper, Gold Record Highs

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moomoo News May 20 19:54 · 6873 Views

Invesco Senior Commodities ETF Strategist Kathy Kriskey discusses gold and copper hitting record highs and says commodities are the answer in times of uncertainty. She speaks with Eric Balchunas and Scarlet Fu on "ETF IQ."

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Transcript

  • 00:00 We have record highs in stocks, if you like zoom out and we also have record highs in metals like copper and gold,
  • 00:06 albeit the flows into gold ETFs have not been as strong as you might think as Eric was just showing us.
  • 00:11 What does that tell you?
  • 00:12 What's going on here?
  • 00:13 There's so much going on.
  • 00:14 And just let's touch on gold initially, right, because what made gold prices go higher?
  • 00:19 It really was emerging markets, central bank buying, right?
  • 00:23 It wasn't ETF, right, because the ETF buyer usually looks for the Fed easing, right.
  • 00:29 And now we know that's delayed.
  • 00:30 And also,
  • 00:31 you know, some of it is the safe haven, right, for those, those investors.
  • 00:35 But it was very different for the emerging market, central banks.
  • 00:38 It was de dollarization, plain and simple, right in there where you know led by China, but a lot of other markets like Poland, Turkey, Singapore, like
  • 00:46 Qatar, there were a lot of other countries that looking to de dollarize, right.
  • 00:49 So that
  • 00:51 but we kept getting the question, where are the ETF flows And remember we saw outflows, Eric, you were pointing that out like weeks ago
  • 00:57 outflows instead of inflows.
  • 00:58 And so and it was plain and simple profit taking.
  • 01:01 I was actually in Europe last week and I was in Zurich and some of the funds they asked me that question, like why?
  • 01:06 Why weren't ETF?
  • 01:08 Why were ETF people selling?
  • 01:10 And I said I think it was profit taking.
  • 01:11 And he's a good answer.
  • 01:12 It was a trick question because they were the one of the ones selling, right.
  • 01:15 And so they said
  • 01:16 they they'd own these gold ETFs for decades, right.
  • 01:20 And they're like, OK, at 2400, it's a sale.
  • 01:23 But the other story I think is really cool is copper.
  • 01:26 So again, it is one of my pet
  • 01:29 favorites because we've been talking about it for the energy transition for so long.
  • 01:33 But now I think that we're shifting to that AI story, these data centers that need so much power, right, and this whole electrification that's going on and these grids needing more copper wiring, plain and simple.
  • 01:46 So let's say somebody is listening to this and they're like,
  • 01:48 you know, I'm sold on the copper story,
  • 01:51 you know there's how do you do, how do you actually invest in copper, right?
  • 01:54 Do you buy the futures or copper stocks in your big ETF, which is PDBC which basically bundles together a lot of Commodity Futures?
  • 02:02 It's so overweight energy and oil, copper is what, 7%.
  • 02:07 So do you still go broad or do you want to hone in and just buy a copper ETF or ETN?
  • 02:12 So now
  • 02:13 even though we're all like institutional investors, very often that come to your show, we're also retail investors personally, right?
  • 02:19 And so I think we have a product DBB, DBB that's equally weight copper, aluminum and zinc.
  • 02:26 And you know, yes, I like it, I like it for a lot of reasons.
  • 02:29 But you're right.
  • 02:29 The problem with us as retail investors is we chase things right.
  • 02:34 And so
  • 02:35 if there's nothing anyone remembers what I say is it don't chase it.
  • 02:38 And that's why I do like broad based commodities like APDBC because you get everything, remember those Prego commercials like it's in there.
  • 02:46 And so it's the same thing with PDBC, you're, it's broad based, right.
  • 02:49 You're getting coverage for all the different commodities.
  • 02:51 And that's one of my other big themes is this, this is a year of uncertainty with all the elections and the the crazy weather and the geopolitics and some of the macro like central banks
  • 03:03 easing, not easing, whatever's going on.
  • 03:05 And I I feel like when we feel that there's so much uncertainty, what do you look to to invest And it the answer is commodities.
  • 03:13 And that's why I know it's hard for retail investors because they want to chase right the geopolitics pushing oil up our goal.
  • 03:19 But
  • 03:20 if you can just give that 5% allocation to commodities and get broad based and sometimes target things like
  • 03:27 but generally do not chase commodities, they are volatile,
  • 03:32 usually the commodity will come to you.
  • 03:33 So again in Europe last week talking about industrial metals, have one said literally I think they were on their phones buying it as I was speaking.
  • 03:40 And so I said no, wait, right, 1100 Ellie copper
  • 03:43 is pretty high.
  • 03:44 I think we need to wait.