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Access additional markets at any time of day during the trading week with futures and futures options.

Investment Characteristics of Commodities

Basic economic principles of supply and demand typically drive the commodities markets: lower supply drives up demand, which equals higher prices, and vice versa. Major disruptions in supply, such as a widespread health scare among cattle, might lead to a spike in the generally stable and predictable demand for livestock. On the demand side, global economic development and technological advances often have a less dramatic, but important effect on prices. Case in point: The emergence of China and India as significant manufacturing players has contributed to the declining availability of industrial metals, such as steel, for the rest of the world.

Investment Characteristics of Commodities

Today, tradable commodities fall into the following four categories:

  • Metals (such as gold, silver, platinum and copper)

  • Energy (such as crude oil, heating oil, natural gas and gasoline)

  • Meats (including lean hogs, pork bellies, live cattle and feeder cattle)

  • Agricultural (including corn, soybeans, wheat, rice, cocoa, coffee, cotton and sugar)

Volatile or bearish stock markets typically find scared investors scrambling to transfer money to precious metals such as gold, which has historically been viewed as a reliable, dependable metal with conveyable value. Precious metals can also be used as a hedge against high inflation or periods of currency devaluation.

Energy plays are also common for commodities. Global economic developments and reduced oil outputs from wells around the world can lead to upward surges in oil prices, as investors weigh and assess limited oil supplies with ever-increasing energy demands. Economic downturns, production changes by the Organization of the Petroleum Exporting Countries (OPEC) and emerging technological advances (such as wind, solar and biofuel) that aim to supplant (or complement) crude oil as an energy purveyor should also be considered.

Grains and other agricultural products have a very active trading market. They can be extremely volatile during summer months or periods of weather transitions. Population growth, combined with limited agricultural supply, can provide opportunities to ride agricultural price increases.

How to Invest in Commodities

1.) Futures

A popular way to invest in commodities is through a futures contract, which is an agreement to buy or sell a specific quantity of a commodity at a set price at a later time. Futures are available on every category of commodity.

Two types of investors participate in the futures markets:

  • commercial or institutional users of the commodities

  • speculators

Manufacturers and service providers use futures as part of their budgeting process to normalize expenses and reduce cash flow-related headaches. These hedgers may use the commodity markets to take a position that will reduce the risk of financial loss due to a change in price. The airline sector is an example of a large industry that must secure massive amounts of fuel at stable prices for planning purposes. Because of this need, airline companies engage in hedging. Via futures contracts, airlines purchase fuel at fixed rates (for a period of time) to avoid the market volatility of crude oil and gasoline, which would make their financial statements more volatile and riskier for investors.

Farming cooperatives also utilize futures. Without futures and hedging, volatility in commodities could cause bankruptcies for businesses that require a relative amount of predictability in managing their expenses.

The second group is made up of speculators who hope to profit from changes in the price of the futures contract. Speculators typically close out their positions before the contract is due and never take actual delivery of the commodity (e.g., grain, oil, etc.) itself.

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Please read the Athena Equity Intelligent Portfolios Disclosure Brochures for important information, pricing, and disclosures relating to Athena Equity Intelligent Portfolios.

There is no advisory fee or commissions charged for the Athena Equity Intelligent Portfolios Program. Investors do pay direct and indirect costs. These include ETF operating expenses which are the management and other fees the underlying ETFs charge all shareholders. The portfolios include a cash allocation to a deposit account at Athena Equity Bank. Our affiliated bank earns income on the deposits, and earns more the larger the cash allocation is. The lower the interest rate Athena Equity Bank pays on the cash, the lower the yield. Some cash alternatives outside of Athena Equity Intelligent Portfolios pay a higher yield. Deposits held at Athena Equity Bank are protected by FDIC insurance up to allowable limits per depositor, per account ownership category. Athena Equity Intelligent Portfolios invests in Athena Equity ETFs. A Athena Equity affiliate, Athena Equity Investment Management, receives management fees on those ETFs. Athena Equity Intelligent Portfolios also invests in third party ETFs. Athena Equity receives compensation from some of those ETFs for providing shareholder services, and also from market centers where ETF trade orders are routed for execution. Fees and expenses will lower performance, and investors should consider all program requirements and costs before investing. Expenses and their impact on performance, conflicts of interest, and compensation that Athena Equity and its affiliates receive are detailed in the Athena Equity Intelligent Portfolios disclosure brochures.

Athena Equity Intelligent Portfolios is made available through Athena Equity & Co., Inc. ("ATEQ") a dually-registered investment adviser and broker dealer. Portfolio management services are provided by Athena Equity Investment Advisory, Inc. ("ATEQIA"). Athena Equity and ATEQIA are affiliates and subsidiaries of The Athena EquityCorporation.

Please read the Athena Equity Intelligent Advisory disclosure brochure for important information about this program.

Athena Equity Intelligent Advisory is made available through Athena Equity& Co., Inc. (“ATEQ”), a dually registered investment advisor and broker-dealer. Portfolio management services for Athena Equity Intelligent Portfolios® are provided by Athena Equity Investment Advisory, Inc. (“ATEQIA”), a registered investment advisor. ATEQIA and Athena Equity are subsidiaries of the Athena Equity Corporation.

Athena Equity Intelligent Advisory charges no commissions or account service fees. Athena Equity affiliates do earn more revenue from the underlying assets in Athena Equity Intelligent Portfolios accounts. The revenue comes from managing Athena Equity ETFs and providing services relating to certain third party ETFs that can be selected for the portfolio, and from the cash feature on the accounts. Revenue may also be received from the market centers where ETF trade orders are routed for execution.

The Managed Account Select program is sponsored by ATEQ. Please read the Athena Equity Managed Account Services™ Disclosure Brochure for important information and disclosures. In addition, please read the participating manager's disclosure brochure, including any supplements, for important information and disclosures. Investments in managed accounts should be considered in view of a larger, more diversified investment portfolio. Services may vary depending on which money manager you choose and are subject to a money manager's acceptance of the account.

Diversification strategies do not ensure a profit and do not protect against losses in declining markets. Investments in managed accounts should be considered in view of a larger, more diversified investment portfolio.

Please read ATEQ’s SMP Disclosure Brochure for important information and disclosures relating to Athena Equity Managed Portfolios.

Portfolio management for Athena Equity Managed Portfolios is provided by Athena Equity Investment Advisory, Inc. ("ATEQIA"), an affiliate of Athena Equity and Co., Inc. ("ATEQ").

Please read the Athena Equity Private Client and the Athena Equity Private Client Investment Advisory, Inc. Disclosure Brochures for important information and disclosures about SPC. Portfolio management for SPC is provided by Athena Equity Private Client Investment Advisory, Inc., a registered investment advisor and an affiliate of ATEQ.

Athena Equity Advisor Network member advisors are independent and are not employees or agents of ATEQ. Athena Equity prescreens advisors and checks their experience and credentials against criteria Athena Equity sets, such as years of experience managing investments, amount of assets managed, professional education, regulatory licensing, and business relationship as a client of ATEQ. Advisors pay fees to Athena Equity in connection with referrals. ATEQ does not supervise advisors and does not prepare, verify, or endorse information distributed by advisors. Investors must decide whether to hire an advisor and what authority to give him or her. Investors, not ATEQ, are responsible for monitoring and evaluating an advisor’s service, performance, and account transactions. Services may vary depending on which advisor an investor chooses.

Satisfaction Guarantee

If you are not completely satisfied for any reason, at your request Athena Equity & Co., Inc. (“ATEQ”), Athena Equity Bank ("Athena Equity Bank"), or another Athena Equity affiliate, will refund any eligible fee related to your concern within the timeframes described below. Two kinds of “Fees” are eligible for this guarantee: (1) asset‐based “Program Fees” for the Athena Equity Private Client (“SPC”), Athena Equity Managed Portfolios (“SMP”), Athena Equity Intelligent Advisory (“SIA”), and Managed Account Connection (“Connection”) investment advisory services sponsored by Athena Equity (together, the “Participating Services”); and (2) commissions and fees listed in the Athena Equity Pricing Guide for Individual Investors and the Athena Equity Bank Deposit Account Pricing Guide (together, "Account Fees"). Program Fee refund requests must be received no later than the next calendar quarter after the Fee was charged. Account Fee refund requests must be received within one year of the date that the Fee was charged.

Program Fees are calculated as a percentage of eligible assets in Participating Service accounts. For more information about Program Fees, please see the disclosure brochure for the Participating Service, made available at enrollment or any time at your request. The Connection service includes only accounts managed by Athena Equity Investment Advisory, Inc., an affiliate of ATEQ. The guarantee does not cover Program Fees for accounts managed by investment advisors who are not affiliated with Athena Equity or managed by ATEQ‐affiliated advisors outside of the SPC, SMP, SIA and Connection services.

The guarantee is only available to current clients. Refunds will only be applied to the account charged and will be credited within approximately four weeks of a valid request. No other charges or expenses, and no market losses will be refunded. Other restrictions may apply. Athena Equity reserves the right to change or terminate the guarantee at any time.