Wikinvest Wire

Jane Quinn on investing in commodities

Wednesday, July 15, 2009

It's not clear exactly why this Bloomberg article about investing in commodities struck me as being so odd (well, aside from the fact that you'd never hear this sort of thing from Caroline Baum), but Jane Bryant Quinn's mostly positive slant on this sector was, well, refreshing.
IMAGE About half way through, Ms. Quinn asks, "If you buy, do you want an ETF or an ETN?"

Most financial journalists still poo-poo the whole idea of having some crude oil futures or gold bars counted as part of your investment portfolio - it's nice to see this is changing.


Anonymous said...

Someone more knowledgeable than me should post to clarify BUT I believe that ETNs and ETFs carry different tax treatments. I own GLD, taxed at ord Y rates, in my IRA and CEF, taxed at CG rates, in my Taxable Acct. Also, don't ETNs theoretically carry the credit risk of the issuing entity? The tax treatment of these products cannot be ignored - some investors may assume they are taxable like normal equities - anything otherwise can significantly impact returns.

I should also note Les Antman is a fan of the Commod Futures Funds (DBA,DBB,DBP,DBE) but for Tax-Advantaged Accts (ie IRA etc) due to ord income taxation.

I welcome clarification/correction here , think this is an important issue as retail buyers step in here

Tim said...

I don't know about CEF but, otherwise, you are correct.

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