New Agriculture ETF/ETP Launches For Diversification (TAGS, CORN, SOYB, CANE, WEAT)

Teucrium Agricultural Fund (NYSE: TAGS) is a new agriculture ETF being launched by Teucrium Trading, LLC.  The new exchange traded product actually appears to be structured as bit like a fund-of-funds model that utilizes an equal weight methodology to invest in the company’s four agricultural commodity ‘ETFs’ of the Teucrium Corn Fund (NYSE: CORN), Teucrium Soybean Fund (NYSE: SOYB), Teucrium Sugar Fund (NYSE: CANE), Teucrium Wheat Fund (NYSE: WEAT).

This new exchange traded product is technically not an ETF because it invests in futures contracts.  Still, it aims to allow investors to allocate investments in the four core agricultural commodities.  The move also allows investors to have exposure here without having to rebalance their exposure themselves.

The aim is to provide a greater degree of diversification as “a way to invest in a next-generation agricultural basket ETP that may be a better option than currently available alternatives.”

Interesting on the surface, but investors better read the fine print here as the underlying ETPs invest in futures rather than in the hard assets.

JON C. OGG