Do ETCs track the underlying commodity price?
ETCs priced off futures are almost 100 per cent correlated with the underlying commodity price, however the spot price return is not an investable return. ETCs are designed to earn a return similar to that which could be earned from investing in the underlying commodity futures markets. ETCs which are physically backed are priced directly off the metal spot price and therefore returns are 100 per cent correlated to the underlying price. These ETCs track the precious metals price less fees.
