House Mountain Partners


A Key Question in the Commodity Rout

Chris Berry2 Comments

By Chris Berry (@cberry1)

For a PDF of this note, please click here.


To anyone involved in commodity markets, the events of the past two weeks should make one thing abundantly clear: a new paradigm in commodity investing is in play. The most recent iteration of the commodity super cycle (2001-2011) was unlike anything many of us had ever seen. Unfortunately, the aftermath (2011-????) and subsequent correction may also be unlike anything we’ve ever seen (at least in terms of duration and intensity). I’m fully aware of the cyclical nature of the commodities business, but clearly the greater the bull market, the more severe the bear market.

Here is the Bloomberg Commodity Index since 2011, down 28% over the past year alone: