The red hot dry bulk shipping ETF Breakwave Dry Bulk Shipping ETF (NYSE Arca: BDRY) surpassed the $100 million in assets under management milestone after a roaring start to 2021.
Launched in 2018, BDRY remains the only freight futures ETF focused exclusively on the dry bulk shipping sector. The fund is managed by New York-based Breakwave Advisors, LLC, which markets it as a way for investors to gain pure-play exposure to the dry bulk market through a portfolio of near-dated freight futures contracts on dry bulk indices without the need for a futures account.
In the first quarter of 2021, BDRY returned 120% making it the stock market’s top-performing ETF, according to rankings by ETF.com. The performance is reflective of expectations for a strong up-cycle in commodities as global economies rebound from impacts of the COVID-19 pandemic.
Oslo, Norway-based Cleaves Securities has named the dry bulk sector as it’s top pick within shipping thanks to a record-low order book and unseasonably high earnings driving already strong sentiment.
“As the global economies reopen, demand for commodities has increased considerably, from iron ore to grains to lumber. Most of the major commodities are transported by ships, and thus demand for transportation services has also increased,” says John Kartsonas, Founding and Managing Partner at Breakwave Advisors LLC. “The cyclical nature of such trends means that the outlook for the global shipping industry remains promising. Finally, the secular trend of decarbonization is also having an impact on shipping by limiting new ship ordering as the industry is waiting for new engine technologies to develop, thus further supporting the shipping upcycle for the years to come.”
Year-to-date, BDRY’s market cap has increased nearly four times, from $24.45 million to $104.5 million as of May 4, 2021.
“We are proud to celebrate this milestone for BDRY, the first ever exchange-traded product answering investor demand for dry bulk shipping, the largest shipping market in the world by volume,” says Sam Masucci, CEO and Founder of ETFMG, which distributes the fund. “As the world reopens post-pandemic, the need for goods is at an all-time high, and BDRY is a great way for investors to play the increase in need for transportation. In the past year, we’ve seen record growth for the Fund, up 461% since this time last year, making it the top performing ETF of 2021. We are hopeful that BDRY will continue to dominate this sector for years to come.”
Today’s milestone announcement happened to coincide with a big sell-off for dry bulk shipping stocks after the Baltic Dry Index snapped its 15-session winning streak. BDRY closed Thursday down over 11% at $23.56 (which is still up over 300% year-to-date).