CMDY vs FAAR

CMDYAiShares Bloomberg Roll Select Commodity Strategy ETF

FAARDFirst Trust Alternative Absolute Return Strategy ETF

In short

CMDY Commodities without the worst of the futures math. CMDY tracks the Roll Select version of the Bloomberg commodity index, where contract choice is written into the rules to ease rolling costs, and charges 0.29% to do it.

FAAR Most commodity funds only bet one way: up. FAAR is actively managed and can run short positions alongside long ones across the futures complex, aiming at absolute return rather than tracking a commodity index.

Stated mandate

CMDY The fund seeks to track an index representing a broad range of commodity exposures, using enhanced roll selection on a total-return basis.

FAAR The Fund seeks long-term total return through active management of long and short exchange-traded commodity futures positions, accessed through a wholly owned Cayman Islands subsidiary.

Why people hold it

• CMDY The name is the strategy. Enhanced roll selection is baked into the index it tracks, so which futures contract to hold is a rule, not an afterthought.
• 0.29% a year sits in the low-fee tier of broad commodity funds, next to BCI, CERY and BCD, and well under what the category typically charges.
• One ticker, a broad basket of roughly 60 futures positions, run on a total-return basis that counts collateral income alongside commodity price moves.
• Live since 2018 under the iShares roof, and one of the stronger implementations in its broad-basket commodity peer group.

• FAAR Goes both ways. The managers can hold long and short exchange-traded commodity futures, so the fund is not structurally locked into commodity prices rising.ftportfolios.com
• Active by design. A few dozen futures positions sized by the manager, not by a fixed index weighting, in a cohort where most rivals simply track a broad commodity benchmark.
• Runs as a registered 1940 Act fund, with the futures book held in a wholly owned Cayman subsidiary. Distributions are paid quarterly.
• Trading since 2016, giving the long/short approach a live record across very different commodity markets rather than a backtest.

Worth knowing

• CMDY Moderately traded rather than a volume monster. Spreads can run wider than the mega-cap index funds, which shows up most on large or hurried orders.
• It is structured as a commodity pool, not a plain stock fund, so the tax paperwork and reporting work differently. Check the details before filing season.
• Distributions land annually or semiannually, not monthly, and the roll rule addresses futures mechanics only. Commodity prices still swing hard on their own.

• FAAR Active costs money: 0.98% a year against a cohort median near 0.68%, and several times what index-based peers like BCI (0.26%) or CMDY (0.29%) charge.
• No index to hug. Short positions can offset a broad commodity rally, so results track the manager's calls rather than the commodity complex itself.
• Mid-sized and moderately traded, so spreads can run wider than the largest commodity futures ETFs.

Full CMDY profile⁠

Full FAAR profile⁠