Physical substances, such as food, grains, and metals, which are interchangeable with another product of the same type. They are most often used as inputs in the production of other goods or services. Investors can buy or sell these, usually through futures contracts. The price of the commodity is subject to supply and demand. Commodities are volatile investments on their own and should form only a small portion of a diversified portfolio to aid in diversification and as a potential hedge against inflation.
A Fund may invest in derivatives, including futures, options, forwards and swaps. Investments in derivatives may cause the Fund’s losses to be greater than if it invests only in conventional securities and can cause the Fund to be more volatile. Derivatives involve risks different from, or possibly greater than, the risks associated with other investments. The Fund’s use of derivatives may cause the Fund’s investment returns to be impacted by the performance of securities the Fund does not own and result in the Fund’s total investment exposure exceeding the value of its portfolio.