WisdomTree has launched its first commodity ETF on the LSE, the broad-based WisdomTree Enhanced Commodity UCITS ETF.

The fund tracks the Optimised Roll Commodity Total Return Index (EBCIWTT), which aims for long-term outperformance of the Bloomberg Commodity Total Return Index through exposure to agriculture, energy, industrial metals and precious metals, along with the use of a smart roll system based on S&P GSCI Dynamic Roll indices.

According to the firm, this combination has allowed the EBCIWTT index to outperform the S&P GSCI Total Return index, the Bloomberg Commodity Index and the Thomson Reuters CRB index over the past one, three, five and ten years with lower volatility.

Victor Nossek, director of research at WisdomTree Europe, said: “The roll methodology in the WisdomTree Enhanced Commodity UCITS ETF substantially mitigates the costs of holding commodity futures contracts and has historically generated positive roll returns.”

“Across the various commodity sectors fundamentals have improved, ranging from a steadier environment for the oil price, negative interest rates likely to benefit sentiment towards gold and a more positive view on emerging markets activity that may drive returns in industrial metals.”