Bull Market in Agriculture

If you think Agriculture sector will be in a move in coming years, like Phileo,  here is two ETF you can to put in your watch list.

Market Vectors Global Agribusiness ETF (MOO) – If you want to achieve wide global diversification among agriculture-related companies, there is no better way to do it than this ETF, with the appropriately named ticker.  MOO tracks the DAXglobal Agribusiness Index and holds positions in 40 companies trading on 13 global exchanges.

These companies run the gamut from equipment makers Komatsu and Deere, to seed and fertilizer companies such as Monsanto and Potash, to firms involved in agricultural chemicals, irrigation, food and livestock operations, ethanol and biodiesel, and food distribution.

This ETF began trading in September 2007 and gained 39 percent by the end of December.  Considering the long-term fundamentals of the agribusiness sector, this is just the beginning of greater gains ahead.  But keep in mind that this ETF is stretched to the upside, so it might be a good idea to accumulate on weakness.

PowerShares DB Agriculture (DBA) – There are few ways to invest directly in agricultural commodities without going into the futures markets.  But the PowerShares DB Agriculture ETF is one of the best.  This ETF provides equally weighted exposure to the four most widely traded “soft” commodities: corn, soybeans, sugar, and wheat.

DBA gained 34 percent in 2007, and with the supplies of these four commodities under long-term pressure from rapidly rising demand, this upward trend should continue in the years to come.