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[OIL IMPACT] Oil funds, ETFs incur losses on price plunge

[THE INVESTOR] Oil funds and exchange-traded funds have been incurring losses over the past month on falling oil prices, according to industry data.

After rising to US$51.23 per barrel in June, crude oil prices have been on a downward trend. On Aug. 2, they hit a near four-month low by falling to US$39.51. 


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Three major oil funds managing 1 billion won (US$ 897,900) or more here have been showing negative growth as of Aug.1, according to local financial data tracker FnGuide on Aug. 3.

The monthly profit rate for the KTB WTI Crude Oil Extraordinary Assets Fund A-type and Samsung WTI Crude Oil Extraordinary Assets Type A stood at minus 10.61 percent and minus 15.2 percent, respectively. The KB US Crude Oil Production Companies Dynamic A Class fund that began selling in March also showed a negative 3.54 percent growth. Related ETFs have been bearing losses, with Mirae Asset’s TIGER Crude Oil Futures ETF showing an 11.23 percent negative growth.

On the other hand, short-position ETFs making bets that oil futures will fall, have been turning up profit. Mirae Asset’s short-position ETF, for instance, has shown 11.58 percent growth during the past month.  

In July, WTI prices lost 13.9 percent per barrel, showing the biggest monthly fall since July 2015.

“The recent declines in crude oil have been triggered by oversupply concerns as Middle East oil-producing nations have been stepping up price competition, while OPEC is pumping up supply and shale productions are going up,” said Min Byung-kyu of Yuanta securities.

By Kim Ji-hyun (jemmie@heraldcorp.com)

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