Supply and demand: the case for commodities

clock • 5 min read

Richard Davis, co-manager of the BlackRock World Resources Equity Income fund, explains why dividend-paying companies in the commodities sector offer value in a low yield environment.

Fluctuating commodities prices have made many investors wary of a sector that seems more prone than most to macroeconomic and geopolitical risks. A more stable way of benefiting from the growth opportunities the commodities sector can offer is an equity income strategy targeting those producers that consistently pay good dividends. While it cannot avoid the highest risks that bedevil the sector, from political issues affecting oil prices to the vagaries of the weather that impact agricultural production, equity income investing can be an effective means of seeking reliable returns ove...

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