Jefferies Group launched its first ETF, the Jefferies | TR/J CRB Global Commodity Equity Index Fund (NYSEArca: CRBQ).
The fund tracks the Thomson Reuters/Jefferies In-the-Ground CRB Global Commodity Equity Index, and it’s the first ETF of many in registration from the firm, including equity ETFs that track agriculture, energy, industrial metals and precious metals.
The index tracks the overall performance of 1,500 listed companies that are involved in the production and distribution of various commodities. The fund uses a modified cap-weighted, float-adjusted, rules-based methodology. Each company needs to derive 50% of its annual revenues from the production and distribution of commodities and commodities products and services.
CRBQ is allocated 38.3% to agriculture, 39% to energy, 14.1% to base/industrial metals and 8.7% to precious metals. The top countries are the United States, 37%; Canada, 13.9%, Great Britain, 8.5% and Russia, 6.8%.
Jefferies says that this ETF shouldn’t be impacted by any potential regulations concerning commodity funds that hold futures contracts, and they wouldn’t trigger a K-1, either. “They avoid the cost and complexity of continually buying and selling expiring futures contracts,” says Adam De Chiara, co-president of Jefferies Asset Management.