As they say in the markets, this year’s losers will be next year’s winners. However, sometimes that adage takes a while to become true. In this instance, we’re talking about commodities and their producers.
The sector was decimated by both the Great Recession and the worldwide credit crisis. Demand fell off a cliff, while supplies remained high. Stocks in the industry fell hard, while prices for a variety of commodities – gold, wheat, corn, etc. – all stayed close to record lows.
And then a funny thing happened: After being at the bottom of the barrel for roughly a decade, commodities have come back with a vengeance.
Rising expectations of growth and inflation have made hard assets and their producers hot. Even better is that the sector could continue the gains through the next few years. The commodities boom might very well be back.
To learn about commodity investing basics, click here.