TY - JOUR T1 - “Black Gold”—Trading Crude Oil for Greater Portfolio Efficiency JF - The Journal of Alternative Investments SP - 44 LP - 50 DO - 10.3905/jai.2004.439643 VL - 7 IS - 2 AU - Mark S Rzepczynski AU - Cengiz Y. Belentepe AU - Wei Feng AU - Philip Lipsky Y1 - 2004/09/30 UR - https://pm-research.com/content/7/2/44.abstract N2 - Commodity markets have proven to be a significant portfolio diversifying asset. However, little work has been conducted as to the statistical significance of this addition. We compare the addition of a commodity index to a traditional portfolio of stocks and bonds against the alternative of adding crude oil futures to serve as a commodity diversifier. We find that the value of such a simplification may be significant. By reducing the number of commodities used to gain portfolio diversification, investors may gain liquidity and flexibility. We run a similar test for gold which has been considered a key commodity diversifier during the inflationary periods of the 1970s and 1980s. ER -