As Oil Takes a Hit, Will PowerShares’ DB Commodity Fund (DBC) Continue Its Climb?

Williamstown, MA, July 20, 2008 --(PR.com)-- “Oil’s incredible run was checked this week,” said Don Dion, publisher of Fidelity Independent Adviser’s PowerShares Momentum Tracker, “but a diversified commodities fund, like DBC, helps protect investors if one particular commodity falls.” http://www.fidelityadviser.com/readMe_PS.asp

DBC has been a mainstay in the PowerShares Momentum Tracker Commodities Portfolio. Added last November, DBC has helped the Portfolio outperform the market during recent downturns. On July 17, PowerShares Momentum Tracker announced that year to date the Portfolio had fallen 10.04% net of fees, while the S&P 500 had slumped 15.27%. http://store.fidelityindependentadviser.com/pws1yr.html

As oil fell below $130 dollars a barrel this week, DBC’s 38% stake in crude pulled the fund down more than 6% from Monday to Thursday. “This is not the first time this year we have seen some pullback,” Dion said, “at times like this, you have to remain mindful of the big picture and remember fundamentals.”

Back in March, PowerShares Momentum Tracker dealt with a similar setback in DBC. The headline for the March 27th feature on DBC urged subscribers: “Despite Shudder, Don’t Abandon DBC.” Commodities prices hit a small bump back in Marchat that time, during what has been a phenomenal rise in demand. As DBC closed at $37.54 on March 27, some investors were left wondering whether the commodities run-up was losing steam.

In this week’s issue, Dion examines the qualities of DBC that may buoy its price as summer wears on. “While oil has certainly driven DBC higher, the fund’s 11.25% percent stake in corn may help the fundit in late summer, when reports on planted acreage are disseminated.” Dion said. “Gold prices have also helped DBC’s returns, as investors continue to worry about inflation,” Dion added. “Investors also are looking to hedge their portfolio, as markets become increasingly correlated.”

Will DBC maintain the momentum necessary to stay atop the PowerShares Momentum Tracker Commodity Momentum Table? Dion still sees potential: “the diversification and returns that DBC have provided to our portfolio will secure the fund’s position in the near term.” Dion concluded that “while we expect commodities to suffer setbacks as they trend higher, DBC’s long- term prospects continue to be bright.”
http://store.fidelityindependentadviser.com/pws1yr.html

PowerShares Momentum Tracker is a member of Fidelity Independent Adviser’s family of financial publications. With more than 70,000 subscribers in the United States and 29 other countries, Fidelity Independent Adviser publishes four monthly newsletters and three weekly newsletters. Its flagship publication, Fidelity Independent Adviser, has been published monthly for 11 years and reaches 40,000 subscribers. http://store.fidelityindependentadviser.com/pws1yr.html

Don Dion, publisher of Fidelity Independent Adviser, is also president and founder of Dion Money Management, a fee-based investment advisory firm to affluent individuals, families and nonprofit organizations, where he is responsible for setting investment policy, creating custom portfolios and overseeing the performance of client accounts. Founded in 1996 and based in Williamstown, Massachusetts, Dion Money Management manages more than $750 million in assets for clients in 49 states and 11 countries. A licensed attorney in Massachusetts and Maine, Mr. Dion has more than 25 years’ experience working in the financial markets, having founded and run two publicly traded companies before establishing Dion Money Management. http://www.dionmm.com/

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