Commodities Indices – What Is The CRB Index

Today we will look at another useful resource, a popular commodity indices – the CRB index. 

What is the CRB index? 

This index utilises the following 19 commodities to provide an overview of how the commodities group is performing at any given time:  Aluminum, Cocoa, Coffee, Copper, Corn, Cotton, Crude Oil, Gold, Heating Oil, Lean Hogs, Live Cattle, Natural Gas, Nickel, Orange Juice, Silver, Soybeans, Sugar, Unleaded Gas and Wheat.

The CRB index is the most popular and widely tracked commodities indices and was originally introduced in 1957; since its inception there have been many updates and subsequent component changes as the index aims to track the most liquid and relevant instruments.  This commodities index uses a weighted system to to track the overall performance of commodities and commodity-related areas.  These are grouped into categories including agriculture, base and industrial metals, energy and precious metals.

The CRB index is available in real time and not just an EOD (End Of Day) product. This makes it extremely usefull as a cross reference for day traders and the like.

CRB Index Components

Source: Thomsonreuters

There is also an ETF (CRBQ) which tracks this index.  The CRB Global Commodity Equity Index Fund is an exchange traded fund which replicates as closely as possible the CRB Global Commodity Equity Index (the Index).  The following chart shows the CRB index ETF plotted against the Dow Jones on a year to date basis.

CRBQ V Dow

Source: Yahoo