iShares Global Timber & Forestry ETF [WOOD] Stock Forecast

Keith McCullough encourages investors to join him in the hunt. You'll need to be agnostic and open-minded, the CEO of investment service Hedgeye Risk Management says.

WOOD includes commodity exposures in lumber, pulp, and cyclical exposures in packaging companies. Packaging companies are suffering due to pressure from faltering Chinese demand. Lumber, timber and pulp prices also have downside from current levels given outstanding economic risks. Current price data has shown some declines since last reports.

The U.S. home-building market exhibits a strong recovery of late, owing to the limited inventory and increased demand. This recovery should benefit some industries that are allied to the housing industry.

Lumber prices have experienced extreme volatility in recent years due to low liquidity and macroeconomic factors. The Chicago Mercantile Exchange introduced a new physical lumber futures contract to improve liquidity, but it remains low. The iShares Global Timber & Forestry ETF tends to move with lumber futures prices and could be a suitable investment for those looking to position for a recovery in the lumber market.

The longtime barometer of wood prices and building activity is being replaced with a new lumber-futures contract in an effort to boost trading.

When it comes down to it, lumber is at the core of my research. It's now been eight years since my original research paper talked about the relationship between lumber and gold and how its predictive nature could help mitigate portfolio risk.

Buffeted by housing market headwinds and tailwinds, lumber has made headlines as one of the most volatile commodities of recent years. What conditions in the broader economy have impacted lumber prices in recent economic cycles, and what does recent housing-starts data portend for this bellwether commodity?

Lumber prices are stable - a new contract makes lumber hedging more versatile. Lumber remains highly illiquid, increasing the chances of explosive and implosive price action.

Commodities ran hot in 2022, and despite a more muted second half, fared well in a tough year that saw both stocks and bonds falter.

Lumber was one of 2022's worst commodity performers, and it has been volatile at the start of this year, but prices may gain on the back of a housing shortage.

iShares Global Timber & Forestry ETF is a US stock and trading under the symbol WOOD

iShares Global Timber & Forestry ETF stock price is $73.687 today.

Yes, iShares Global Timber & Forestry ETF is a publicly traded company.