Natural and catastrophic events · Natural disasters and extreme weather
The commodity futures markets may be subject to temporary distortions due to various factors, including lack of liquidity, congestion, disorderly closing periods, manipulation and disruptive conduct, limitations on deliverable supplies, excessive speculation, changes in trade regulation or economic sanctions (actual or threatened), government regulation and intervention, technical and operational or system failures, nuclear accidents, terrorism, riots and acts of God.
Geopolitical and trade · Trade policies tariffs and sanctions
Following Russia's invasion of Ukraine in late February 2022, various countries, including the United States, Australia, Canada, the United Kingdom, Switzerland, Germany, France, and Japan, as well as NATO and the European Union, issued broad-ranging economic sanctions against Russia and Belarus. Russia may take additional countermeasures or retaliatory actions (including cyberattacks), which could exacerbate negative consequences on global financial markets.
Natural and catastrophic events · Pandemic and public health crises
As demonstrated during the unprecedented market conditions in 2020, volatility in certain futures contracts may spike significantly during periods of global economic and social stress. Widespread disease, including pandemics and epidemics, have been and may be highly disruptive to economies and markets.
Economic and market conditions · Economic recession and downturns
A decrease in U.S. imports or exports, changes in trade regulations, including the threat or actual imposition of tariffs, trade wars or other economic sanctions on traditional allies or adversaries and their responses thereto, inflation, and/or an economic recession in the U.S. may have a material adverse affect on the U.S. economy, global financial markets as a whole and the commodities markets to which the Fund has exposure.
Economic and market conditions · Inflation and deflation pressures
Domestic and foreign inflation rates and investors' expectations concerning inflation rates are factors that may affect the prices of the Index Commodities. Additionally, natural or environmental disasters and widespread disease may adversely impact inflation rates and other factors affecting the value of the Fund's investments.
Economic and market conditions · Market volatility and financial crises
The Fund may incur major losses in the event of disrupted markets and other extraordinary events in which historical pricing relationships become materially distorted. The risk of loss from pricing distortions is compounded by the fact that in disrupted markets many positions become illiquid, making it difficult or impossible to close out or liquidate positions against which the markets are moving.