Portfolio Diversification Strategy

• For those who want to diversify their portfolios beyond shares, bonds and real estate, commodities are the best option.

Popularly known as Alternative Asset Class

• Portfolio diversification– Commodities tend to reduce the overall risk of a portfolio while increasing the overall return as they bear low to negative correlation with traditional asset classes like stocks and bonds.

• Historically, commodity futures has been less volatile compared with equities and bonds, thus providing an efficient portfolio diversification option.

• Allocating 15 - 20% of one’s portfolio to commodities, investor can vastly improve performance in hostile markets.

• CME Study - diversifying a stock/bond portfolio in commodities futures can increase Portfolio’s overall return by as much as 50% with comparable risk.

• Portfolio Composition of 45% Stocks, 35% Bonds and 20% Commodities Futures normally generate better returns with comparatively lesser volatility.