Agricultural Commodities ETFs
Agricultural commodities ETFs sell securities that provide a return tied to the prices of farm products such as wheat, corn, sugar and coffee. Each ETF buys futures contracts in a basket of specific agricultural commodities, in proportions allowing it to track or match the performance of an index derived from the prices of each commodity. Investors gain a stake in an ETF by buying shares, which trade throughout the day on a securities exchange.
Because the market sets the price of shares of exchange-traded funds, traders attempt to profit by buying or borrowing shares against the expectation of reselling with a rise in price, similar to trading in stocks.
