The Vibe Shift From Money to Things Now Comes In ETF Form
Tugboats pull on the Ever Forward container ship in Pasadena, Maryland, trying to free the cargo ship as it sits in the Chesapeake Bay after it ran aground near Baltimore.
Photographer: Jim Watson/AFP/Getty ImagesIt’s no secret that everyone is now talking about supply chains and logistics.
On the most recent episode of the Odd Lots podcast, Credit Suisse AG strategist Zoltan Pozsar outlined his vision for the future as a world where the focus shifts from problems that can be solved with money to those that can’t. In this world — one in which securing physical commodities like oil, grains and metals are paramount — the emphasis is on who can produce or move the most. Transportation becomes the new balance sheet.
Or as my co-host Joe Weisenthal put it earlier, there’s a shift in focus from the monetary to the physical, the nominal to the real.
And now, there’s an ETF to capture this vibe shift too.
ProShares announced on Thursday that it’s launched an ETF aimed at giving “investors access to companies involved in each point of the process that moves raw materials and goods around the world.” It’s called the Supply Chain Logistics ETF ($SUPL) and you can see its top 10 holdings below.
Eagle-eyed Odd Lots listeners might spot a familiar name on the list.
It’s Evergreen Marine Corp., the owner of the Ever Given, the massive container ship which halted global trade after getting stuck in the Suez Canal for six days last year, as well as the Ever Forward, the massive container ship which is currently stuck in the Chesapeake Bay (and which is carrying the contents of my entire apartment).
While there’s a bull case to be made for the shipping industry, which has seen profits skyrocket in recent years, moving stuff clearly isn’t always that easy. Meanwhile, financialized exposure to the world of physical goods doesn’t always work out as expected. That’s a point made by Zoltan too, who describes how we’re just beginning to appreciate the “plumbing that underlines the physical movement and trading of commodities.”
One recent example of the daylight between financialized exposure to physical commodities gone awry is the Teucrium Wheat Fund ($WEAT), which was forced to suspend creation of new shares last month after Russia’s invasion of Ukraine sparked unprecedented interest in using the ETF to go long grains.