CIBC’s wholesale banking business has launched Canada’s first tradable commodities index, the bank announced on Monday.

The proprietary Composite Commodities Index offers investors the ability to invest in a range of futures contracts in the commodities sector. It tracks the price of futures contracts in four commodity subsectors: agriculture, energy, base metals and precious metals.

“With strong signals that the economies in East Asia are starting to emerge from the global economic recession, investors are paying close attention to commodities once again,” said Rob Forgrave, head of commodities trading for CIBC World Markets Inc. “Our index allows Canadian investors the ability to customize their exposures across 16 different commodities.”

Investors can customize their exposure to specific commodities or subsectors of the index, based on their investment strategies. The index also gives investors flexibility to roll futures positions.

“The commodity sector, from oil to copper to wheat, is vital to the Canadian economy and more investors want the ability to leverage off this growth,” added Forgrave. “We built this index to give our investors greater access to the commodity markets based on their own investment interests and exposure limits.”

The index is unique, according to CIBC, since it is tradable and highly liquid. Most Canadian commodities indexes are typically used for economic benchmarking rather than trading.

All commodity futures contracts in index are listed and traded on the CME, LME and ICE.

The Composite Commodities Index is the first in a series of proprietary indices that CIBC is planning to launch as it broadens product offerings. The other indexes will cover interest rates, currencies and equities.

IE