Broad commodities have staged a nice comeback in the second half of this year on tight supply conditions and strong global demand. A pick up in global growth with every major economy witnessing growth in almost a decade led to bullishness in the space.

Given the encouraging fundamentals, a New York-based research firm, Goldman Sachs (GS – Free Report) believes commodities should outperform equities and other asset classes next year. It expects commodities to rise almost 10% in 2018, against its previous forecast of 4% returns. Additionally, the tightening monetary policy in the United States will support the rally as commodities perform well during periods of rising interest rates.

According to Jeffrey Currie, head of commodities research for the firm in New York, energy is expected to top with returns of 12% thanks to positive roll yield. The oil market remains in a state of backwardation, where later-dated contracts are cheaper than near-term contracts, for the whole of 2018. Industrial metals will likely generate flat returns and Goldman has a most bullish outlook on copper and most bearish views on aluminum. Though global demand remains robust for both the metals, copper will benefit from the end of a supply expansion boom while aluminum will see a decline in prices from growing supply.

Investors seeking to ride on Goldman’s views on commodities can choose from a wide variety of products, including ETFs and ETNs. Below, we have highlighted four ETFs which we think could be well positioned if Goldman commodity prediction comes true:

iShares S&P GSCI Commodity-Indexed Trust (GSG – Free Report)

This fund follows the S&P GSCI Total Return Index offering exposure to a broad range of commodities through investments in futures contracts. Energy makes up for nearly 63% of the portfolio while agriculture and industrial metals round off the next two spots with double-digit exposure. GSG has AUM of $1.3 billion and average daily volume of 318,000 shares. It charges 75 bps in annual fees and has gained more than 11% over the past six months.
 
PowerShares DB Commodity Index Tracking Fund (DBC – Free Report)