What is the CRB Index?
The Thomson Reuters/Core Commodity (CRB Index) is designed to provide a representation of trends in the overall commodity prices. To be able to continue to accomplish this objective, the makeup and formula have been adjusted to be able to show changes in market structure and activity. Since 1957, there have been ten revisions to the index components. The first was in 1961 and the latest in 2005.
Uses of the CRB Index
This index is used to be able to measure a basket of commodities to give an indication of supply and demand across a number of countries and commodities.
Risks of the CRB Index
All futures contracts will feature the same risk through the direction in which you anticipate the contract to rise or fall. If you anticipate a currency to increase in value and it ends up falling in value. The long position that you hold will also fall in value.