Invesco DB Precious Metals Fund
For the period ended Sep 30, 2024. Filed Nov 7, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 7, 2024
DBP$90.75-0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-07.
0000950170-24-092095
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-07.
0000950170-24-122598
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 95 previous paragraphs and 95 current paragraphs.
68 unchanged; 19 reworded; 8 added; 8 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
Current report
Returns for the Three and Nine Months Ended September 30, 2024 and 2023
Current report
For the three months ended September 30, 2024, the NYSE Arca market value of each Share increased from $57.29 per Share to $63.76 per Share. The Share price low and high for the three months ended September 30, 2024 and related change from the Share price on June 30, 2024 was as follows: Shares traded at a low of $57.28 per Share (-0.03%) on August 7, 2024 and a high of $64.98 per Share (+13.41%) on September 26, 2024. The total return for the Fund on a market value basis was +11.29%.
Current report
Precious metals ended the third quarter of 2024 significantly higher, with gold continuing to break through its previous record highs. While markets have been speculating on the Federal Reserve’s easing of interest rates since the end of 2022, the central bank finally kicked off its rate-cutting cycle in September. Prices rallied leading into it, as Federal Reserve Chair Powell’s dovish comment at the Jackson Hole symposium mostly cemented the September 0.50% cut. In addition, a more sustained recovery of ETP and money manager flows also supported the bullish story. While not a huge impact, escalating geopolitical tensions in the Middle East likely also contributed to the gains.
Current report
For the three months ended September 30, 2023, the NYSE Arca market value of each Share decreased from $49.35 per Share to $47.45 per Share. The Share price low and high for the three months ended September 30, 2023 and related change from the Share price on June 30, 2023 was as follows: Shares traded at a low of $47.45 per Share (-3.85%) on September 29, 2023 and a high of $51.53 per Share (+4.42%) on July 19, 2023. The total return for the Fund on a market value basis was -3.85%.
Current report
Precious metals continued lower in the third quarter of 2023. While gold initially gained in July as the significant drop in US inflation further cemented expectations that the Federal Reserve was nearing the end of its rate hike cycle, prices retreated for the most part in August and September. The slight bump in US inflation, indications that the Federal Reserve will likely keep interest rates high, Fitch’s downgrade of the US government debt rating (which led to increased treasury yields) and equity market downturn all contributed to the downward pressure on gold prices. Strong central bank demand supported gold prices, though investor demand remained subdued, preventing any significant rallies. Silver prices rose slightly from the recovery in industrial metals but still ended the quarter slightly lower.
Current report
Net income (loss) for the nine months ended September 30, 2024 was $37.9 million, primarily resulting from income of $6.0 million, from net realized gain (loss) of $2.1 million, net change in unrealized gain (loss) of $30.8 million and net operating expenses of $0.8 million.
Current report
Net income (loss) for the nine months ended September 30, 2023 was $(1.7) million, primarily resulting from income of $5.8 million, from net realized gain (loss) of $5.2 million, net change in unrealized gain (loss) of $(11.8) million and net operating expenses of $0.8 million.
Removed paragraphs (8)
Previous report
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024 AND 2023
Previous report
Returns for the Three and Six Months Ended June 30, 2024 and 2023
Previous report
For the three months ended June 30, 2024, the NYSE Arca market value of each Share increased from $53.46 per Share to $57.29 per Share. The Share price low and high for the three months ended June 30, 2024 and related change from the Share price on March 31, 2024 was as follows: Shares traded at a low of $54.03 per Share (+1.08%) on April 1, 2024 and a high of $60.48 per Share (+13.14%) on May 21, 2024. The total return for the Fund on a market value basis was +7.17%.
Previous report
Precious metals ended the second quarter of 2024 positive. Bullish drivers from the previous (central bank purchases, Asian consumer demand, Federal Reserve easing expectations and geopolitical uncertainty) continued to support gold, pushing front month prices to a new record high of over $2,400 in mid-May. However, the stall in Chinese central bank purchases and increased profit-taking did add some pressure. ETF investor demand for gold also turned more optimistic following declines since April 2022. That said, silver was the outperformer, with front month futures rallying 17% on robust solar, and recovering industrial demand, all amid forecasts for a fourth consecutive annual deficit. Finally, US election uncertainty was the new supportive driver for precious metals.
Previous report
For the three months ended June 30, 2023, the NYSE Arca market value of each Share decreased from $51.02 per Share to $49.35 per Share. The Share price low and high for the three months ended June 30, 2023 and related change from the Share price on March 31, 2023 was as follows: Shares traded at a low of $49.03 per Share (-3.89%) on June 29, 2023 and a high of $53.42 per Share (+4.71%) on May 4, 2023. The total return for the Fund on a market value basis was -3.27%.
Previous report
Precious metals posted a slightly negative second quarter of 2023 with front month gold and silver both ending below their 50- and 100-day moving averages. While both metals were higher in April leading up to the failure of First Republic Bank – the second largest default in US history and the third one since March 2023 – prices retreated in May and June amid reduced safe haven demand and continued pressure from the Federal Reserve. Not only did contagion fears from the banking sector turmoil dissipate but the US government was able to reach a deal in time to avert what would have been the first US debt ceiling default in history. Furthermore, while the market largely expected the Federal Reserve to ease interest rate hikes amid cooling inflation, their hawkish stance proved to be stickier than expected, only pausing in June while signaling more rate hikes to come. While strong central bank demand, especially from China, which increased its reserves for seven months in a row, provided some support, other bearish drivers still dominated.
Previous report
Net income (loss) for the six months ended June 30, 2024 was $19.9 million, primarily resulting from income of $3.8 million, from net realized gain (loss) of $1.2 million, net change in unrealized gain (loss) of $15.4 million and net operating expenses of $0.5 million.
Previous report
Net income (loss) for the six months ended June 30, 2023 was $3.6 million, primarily resulting from income of $3.7 million, from net realized gain (loss) of $2.7 million, net change in unrealized gain (loss) of $(2.2) million and net operating expenses of $0.6 million.
Reworded paragraphs (19)
Previous wording
On any business day, an Authorized Participant may place an order with the Transfer Agent to redeem one or more blocks of 50,000 Shares (“Creation Units”). Redemption orders must be placed by 10:00 a.m., Eastern Time. The day on which the Managing Owner receives a valid redemption order is the redemption order date. The day on which a redemption order is settled is the redemption order settlement date. As provided below, the redemption order settlement date may occur up to two business days after the redemption order date. Redemption orders are irrevocable. The redemption procedures allow Authorized Participants to redeem Creation Units. Individual Shareholders may not redeem directly from the Fund. Instead, individual Shareholders may only redeem Shares in integral multiples of 50,000 and only through an Authorized Participant.
Current wording
On any business day, an Authorized Participant may place an order with the Transfer Agent to redeem one or more blocks of 50,000 Shares (“Creation Units”). Redemption orders must be placed by 10:00 a.m., Eastern Time. The day on which the Managing Owner receives a valid redemption order is the redemption order date. The day on which a redemption order is settled is the redemption order settlement date. As provided below, the redemption order settlement date may occur up to one business day after the redemption order date. Redemption orders are irrevocable. The redemption procedures allow Authorized Participants to redeem Creation Units. Individual Shareholders may not redeem directly from the Fund. Instead, individual Shareholders may only redeem Shares in integral multiples of 50,000 and only through an Authorized Participant.
Previous wording
Unless otherwise agreed to by the Managing Owner and the Authorized Participant as provided in the next sentence, by placing a redemption order, an Authorized Participant agrees to deliver the Creation Units to be redeemed through DTC’s book-entry system to the Fund no later than the redemption order settlement date as of 2:45 p.m., Eastern Time, on the business day immediately following the redemption order date. Upon submission of a redemption order, the Authorized Participant may request the Managing Owner to agree to a redemption order settlement date up to two business days after the redemption order date. By placing a redemption order, and prior to receipt of the redemption proceeds, an Authorized Participant’s DTC account is charged the non-refundable transaction fee due for the redemption order.
Current wording
Unless otherwise agreed to by the Managing Owner and the Authorized Participant as provided in the next sentence, by placing a redemption order, an Authorized Participant agrees to deliver the Creation Units to be redeemed through DTC’s book-entry system to the Fund no later than the redemption order settlement date as of 2:45 p.m., Eastern Time, on the business day immediately following the redemption order date. Upon submission of a redemption order, the Authorized Participant may request the Managing Owner to agree to a redemption order settlement date up to one business day after the redemption order date. By placing a redemption order, and prior to receipt of the redemption proceeds, an Authorized Participant’s DTC account is charged the non-refundable transaction fee due for the redemption order.
Previous wording
Net cash flow provided by (used in) operating activities was $12.4 million and $(55.0) million for the six months ended June 30, 2024 and 2023, respectively. These amounts primarily include net income (loss), net purchases and sales of money market mutual funds and net purchases and sales of United States Treasury Obligations and affiliated investments. The Fund invests in United States Treasury Obligations, money market mutual funds and T-Bill ETFs (affiliated or otherwise), if any, for margin and/or cash management purposes. While the Fund's performance reflects the appreciation and depreciation of those holdings, the Fund's performance, whether positive or negative, is driven primarily by its strategy of trading futures contracts with the aim of seeking to track the Index.
Current wording
Net cash flow provided by (used in) operating activities was $6.5 million and $(27.8) million for the nine months ended September 30, 2024 and 2023, respectively. These amounts primarily include net income (loss), net purchases and sales of money market mutual funds and net purchases and sales of United States Treasury Obligations and affiliated investments. The Fund invests in United States Treasury Obligations, money market mutual funds and T-Bill ETFs (affiliated or otherwise), if any, for margin and/or cash management purposes. While the Fund's performance reflects the appreciation and depreciation of those holdings, the Fund's performance, whether positive or negative, is driven primarily by its strategy of trading futures contracts with the aim of seeking to track the Index.
Previous wording
During the six months ended June 30, 2024, $53.6 million was paid to purchase United States Treasury Obligations and $55.0 million was received from sales and maturing United States Treasury Obligations. During the six months ended June 30, 2023, $117.8 million was paid to purchase United States Treasury Obligations and $100.0 million was received from sales and maturing United States Treasury Obligations. $79.3 million was received from sales of affiliated investments and $85.4 million was paid to purchase affiliated investments during the six months ended June 30, 2024. $129.7 million was received from sales of affiliated investments and $168.0 million was paid to purchase affiliated investments during the six months ended June 30, 2023.
Current wording
During the nine months ended September 30, 2024, $53.6 million was paid to purchase United States Treasury Obligations and $55.0 million was received from sales and maturing United States Treasury Obligations. During the nine months ended September 30, 2023, $122.7 million was paid to purchase United States Treasury Obligations and $105.0 million was received from sales and maturing United States Treasury Obligations. $117.7 million was received from sales of affiliated investments and $148.3 million was paid to purchase affiliated investments during the nine months ended September 30, 2024. $187.7 million was received from sales of affiliated investments and $194.8 million was paid to purchase affiliated investments during the nine months ended September 30, 2023.
Previous wording
The Fund’s net cash flow provided by (used in) financing activities was $(12.4) million and $54.2 million during the six months ended June 30, 2024 and 2023, respectively. This included $8.7 million and $86.3 million from Shares purchased by Authorized Participants and $21.1 million and $32.1 million from Shares redeemed by Authorized Participants during the six months ended June 30, 2024 and 2023, respectively.
Current wording
The Fund’s net cash flow provided by (used in) financing activities was $(6.5) million and $26.9 million during the nine months ended September 30, 2024 and 2023, respectively. This included $20.8 million and $91.3 million from Shares purchased by Authorized Participants and $27.3 million and $64.4 million from Shares redeemed by Authorized Participants during the nine months ended September 30, 2024 and 2023, respectively.
Previous wording
COMPARISON OF MARKET, NAV AND DBIQ-OPT YIELD PRECIOUS METALS INDEX ERTM FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024 AND 2023
Current wording
COMPARISON OF MARKET, NAV AND DBIQ-OPT YIELD PRECIOUS METALS INDEX ERTM FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
Previous wording
This Report covers the three and six months ended June 30, 2024 and 2023. Past performance of the Fund is not necessarily indicative of future performance.
Current wording
This Report covers the three and nine months ended September 30, 2024 and 2023. Past performance of the Fund is not necessarily indicative of future performance.
Previous wording
The section “Summary of the DBIQ-OY Precious Metals TR™ and Underlying Index Commodity Returns for the Three and Six Months Ended June 30, 2024 and 2023” below provides an overview of the changes in the closing levels of the DBIQ-OY Precious Metals TR™ by disclosing the change in market value of each underlying component Index Commodity through a “surrogate” (and analogous) index that also reflects 3-month United States Treasury Obligations returns. Please note also that the Fund’s objective is to track the Index (not the DBIQ-OY Precious Metals TR™), and the Fund does not attempt to outperform or underperform the Index. The Index employs the optimum yield roll method with the objective of mitigating the negative effects of contango, the condition in which distant delivery prices for futures exceed spot prices, and maximizing the positive effects of backwardation, a condition opposite of contango.
Current wording
The section “Summary of the DBIQ-OY Precious Metals TR™ and Underlying Index Commodity Returns for the Three and Nine Months Ended September 30, 2024 and 2023” below provides an overview of the changes in the closing levels of the DBIQ-OY Precious Metals TR™ by disclosing the change in market value of each underlying component Index Commodity through a “surrogate” (and analogous) index that also reflects 3-month United States Treasury Obligations returns. Please note also that the Fund’s objective is to track the Index (not the DBIQ-OY Precious Metals TR™), and the Fund does not attempt to outperform or underperform the Index. The Index employs the optimum yield roll method with the objective of mitigating the negative effects of contango, the condition in which distant delivery prices for futures exceed spot prices, and maximizing the positive effects of backwardation, a condition opposite of contango.
Previous wording
For the three months ended June 30, 2024, the NAV of each Share increased from $53.39 per Share to $57.40 per Share. Rising commodity futures contracts prices for gold and silver during the three months ended June 30, 2024 contributed to an overall 6.29% increase in the level of the Index and to a 7.72% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was +7.51%.
Current wording
For the three months ended September 30, 2024, the NAV of each Share increased from $57.40 per Share to $63.93 per Share. Rising commodity futures contracts prices for gold and silver during the three months ended September 30, 2024 contributed to an overall 10.08% increase in the level of the Index and to a 11.53% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was +11.38%.
Previous wording
Net income (loss) for the three months ended June 30, 2024 was $10.9 million, primarily resulting from income of $2.0 million, from net realized gain (loss) of $1.4 million, net change in unrealized gain (loss) of $7.8 million and net operating expenses of $0.3 million.
Current wording
Net income (loss) for the three months ended September 30, 2024 was $18.0 million, primarily resulting from income of $2.2 million, from net realized gain (loss) of $0.8 million, net change in unrealized gain (loss) of $15.3 million and net operating expenses of $0.3 million.
Previous wording
For the three months ended June 30, 2023, the NAV of each Share decreased from $50.92 per Share to $49.40 per Share. Falling commodity futures contracts prices for gold and silver during the three months ended June 30, 2023 contributed to an overall 3.98% decrease in the level of the Index and to a 2.74% decrease in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was -2.98%.
Current wording
For the three months ended September 30, 2023, the NAV of each Share decreased from $49.40 per Share to $47.51 per Share. Falling commodity futures contracts prices for gold and silver during the three months ended September 30, 2023 contributed to an overall 4.91% decrease in the level of the Index and to a 3.62% decrease in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was -3.83%.
Previous wording
Net income (loss) for the three months ended June 30, 2023 was $(5.7) million, primarily resulting from income of $2.1 million, from net realized gain (loss) of $1.9 million, net change in unrealized gain (loss) of $(9.4) million and net operating expenses of $0.3 million.
Current wording
Net income (loss) for the three months ended September 30, 2023 was $(5.3) million, primarily resulting from income of $2.1 million, from net realized gain (loss) of $2.4 million, net change in unrealized gain (loss) of $(9.5) million and net operating expenses of $0.3 million.
Previous wording
FOR THE SIX MONTHS ENDED JUNE 30, 2024 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2023
Current wording
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2023
Previous wording
For the six months ended June 30, 2024, the NYSE Arca market value of each Share increased from $50.03 per Share to $57.29 per Share. The Share price low and high for the six months ended June 30, 2024 and related change from the Share price on December 31, 2023 was as follows: Shares traded at a low of $48.03 per Share (-4.00%) on February 14, 2024 and a high of $60.48 per Share (+20.90%) on May 21, 2024. The total return for the Fund on a market value basis was +14.51%.
Current wording
For the nine months ended September 30, 2024, the NYSE Arca market value of each Share increased from $50.03 per Share to $63.76 per Share. The Share price low and high for the nine months ended September 30, 2024 and related change from the Share price on December 31, 2023 was as follows: Shares traded at a low of $48.03 per Share (-4.00%) on February 14, 2024 and a high of $64.98 per Share (+29.89%) on September 26, 2024. The total return for the Fund on a market value basis was +27.44%.
Previous wording
Precious metals showed strong performance in the first half of 2024. In the first quarter, price gains were underpinned by expectations that the Federal Reserve would start easing interest rates imminently, strong central bank demand, robust Asian consumer demand, and the increased call for haven assets from the escalating conflicts. Front month prices broke past all-time highs, even surpassing levels during the COVID-19 pandemic. Silver also gained, riding the wave higher with industrial metals, though prices were further supported by robust solar, and expectations for a fourth consecutive annual deficit. While the bullion did face headwinds in the second quarter from the stall in Chinese central bank purchases and increased profit taking, the metal has managed to hold its ground, with its front month contract staying above the $2,300 threshold.
Current wording
Precious metals showed strong performance in the first three quarters of 2024, with both gold and silver front month prices up around 30%. In the first quarter, price gains were underpinned by expectations that the Federal Reserve would start easing interest rates imminently, strong central bank demand, robust Asian consumer demand, and the increased call for haven assets from the escalating conflicts. Front month prices broke past all-time highs, even surpassing levels during the COVID-19 pandemic. Silver also gained, riding the wave higher with industrial metals, though prices were further supported by robust solar, and improving industrial demand amid expectations for a fourth consecutive annual deficit. While the bullion did face headwinds in the second quarter from the stall in Chinese central bank purchases and increased profit taking, the metal returned to strong gains in the third quarter with the Federal Reserve’s interest rate-cutting cycle finally underway and ETP demand coming back.
Previous wording
For the six months ended June 30, 2023, the NYSE Arca market value of each Share increased from $48.00 per Share to $49.35 per Share. The Share price low and high for the six months ended June 30, 2023 and related change from the Share price on December 31, 2022 was as follows: Shares traded at a low of $46.15 per Share (-3.86%) on March 7, 2023 and a high of $53.42 per Share (+11.29%) on May 4, 2023. The total return for the Fund on a market value basis was +2.81%.
Current wording
For the nine months ended September 30, 2023, the NYSE Arca market value of each Share decreased from $48.00 per Share to $47.45 per Share. The Share price low and high for the nine months ended September 30, 2023 and related change from the Share price on December 31, 2022 was as follows: Shares traded at a low of $46.15 per Share (-3.86%) on March 7, 2023 and a high of $53.42 per Share (+11.29%) on May 4, 2023. The total return for the Fund on a market value basis was -1.15%.
Previous wording
Precious metals ended the first half of 2023 slightly higher with gains in gold during the first quarter of 2023 holding up against losses in the second quarter. In March, gold prices had rallied sharply following the collapse of Silicon Valley Bank. Investors flocked to safe havens like the bullion in fear that a contagion effect could ripple through the US and even the global financial sector. Expectations that the Federal Reserve would start to soften its aggressive rate-hike policy also added some gains earlier in the first quarter, though that was fully reversed in February given more persistent than-expected inflation and a resilient US labor market. Then in the second quarter, both metals moved lower with front month prices ending below their 50- and 100-day moving averages. While both were higher in April leading up to the failure of First Republic Bank – the second largest default in US history and the third one since March 2023 – prices retreated in May and June amid reduced safe haven demand and continued pressure from the Federal Reserve. Not only did contagion fears from the banking sector turmoil dissipate but the US government was able to reach a deal in time, to avert what would have been the first US debt ceiling default in history. In addition to the bearish drivers for precious metals, silver was also pressured by the disappointing recovery in China. While strong central bank demand, especially from China, which increased its reserves for seven months in a row, provided some support, other bearish factors remained in control.
Current wording
Precious metals ended the first three quarters of 2023 slightly lower with gains in gold from the first quarter failing to hold up against losses in the second and third quarter. In March, gold prices had rallied sharply following the collapse of Silicon Valley Bank. Investors flocked to safe havens like the bullion in fear that a contagion effect could ripple through the US and even global financial sector. Expectations that the Federal Reserve would start to soften its aggressive rate-hike policy also added some gains earlier in the first quarter, though that was fully reversed in February given continued inflation and a resilient US labor market. However, in the second quarter, both metals moved lower as contagion fears from the banking sector turmoil dissipated and the US government was able to reach a deal related to the debt ceiling, averting what would have been the first US debt ceiling default in history. Prices remained pressured in the third quarter as the Federal Reserve indicated that it would likely keep interest rates high for longer than the market expected and the US dollar held up.
Previous wording
For the six months ended June 30, 2024, the NAV of each Share increased from $49.99 per Share to $57.40 per Share. Rising commodity futures contracts prices for gold and silver during the six months ended June 30, 2024 contributed to an overall 12.32% increase in the level of the Index and to a 15.35% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was +14.82%.
Current wording
For the nine months ended September 30, 2024, the NAV of each Share increased from $49.99 per Share to $63.93 per Share. Rising commodity futures contracts prices for gold and silver during the nine months ended September 30, 2024 contributed to an overall 23.64% increase in the level of the Index and to a 28.66% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was +27.89%.
Previous wording
For the six months ended June 30, 2023, the NAV of each Share increased from $47.89 per Share to $49.40 per Share. Rising commodity futures contracts prices for gold and silver during the six months ended June 30, 2023 contributed to an overall 1.21% increase in the level of the Index and to a 3.72% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was +3.15%.
Current wording
For the nine months ended September 30, 2023, the NAV of each Share decreased from $47.89 per Share to $47.51 per Share. Falling commodity futures contracts prices for gold and silver during the nine months ended September 30, 2023 contributed to an overall 3.76% increase in the level of the Index and to a 0.03% increase in the level of the DBIQ-OY Precious Metals TR™. The total return for the Fund on a NAV basis was -0.79%.