Teucrium: Investor Education Series
Teucrium | August 16, 2022
Trading Futures Based ETFs
Thank you for considering our funds.
This information does not constitute advice, but rather conveys what institutional investors have shared with us as “best practices,” for trading futures-based ETFs.
1. Time of Day - Be aware of the market hours of an ETF’s underlying securities. Teucrium’s ETFs trade on the NYSE and are available to trade during NYSE trading hours (typically 9:30 a.m. ET – 4:00 p.m. ET). Commodity futures markets, however, have different trading hours. This means that funds such as TILL, which holds corn, wheat, soybean, and sugar futures continue to trade on the NYSE even after the underlying futures markets have closed. Institutional investors have shared with us that they prefer to place trades in our ETFs while the underlying markets are trading.
Day Session Trading Hours Monday - Friday:
Corn (CME) 9:30 a.m. – 2:20 p.m. ET (settlement pricing at 2:15 p.m. ET)
Chicago Wheat (CME) 9:30 a.m. – 2:20 p.m. ET (settlement pricing at 2:15 p.m. ET)
Soybeans (CME) 9:30 a.m. – 2:20 p.m. ET (settlement pricing at 2:15 p.m. ET)
No 11. Sugar (ICE) 3:30 a.m. – 1:00 p.m. ET
NOTE: As a general rule, we are told the best liquidity in our ETFs often occurs a few minutes after the open of the NYSE and a few minutes before the closing range begins on the futures exchanges. As such, a muti-commodity product like TILL or TAGS may be best executed between the hours of approximately 9:45 a.m. ET and 12:45 p.m. ET (15 minutes after the NYSE open and 15 minutes before the ICE sugar close.
2. Limit Orders – Many institutional investors with whom we speak prefer to use Limit Orders versus market orders. Given the rise of machine/algo-trading, execution of market orders can be volatile, most especially “market-on-open” and “market on close” orders (see above). The risk of machine traded volatility impacting execution can be removed by utilizing a limit order.
3. Execution Desks – You may consider contacting your broker’s trade/execution desk, especially if you are placing high volume trades. We are standing by to assist you in any way we can. Please contact our Capital Market/Operations desk at 802-540-0019.
Please do not hesitate to contact us with any questions or ideas that you might like to discuss.
802-540-0019