Will coal end up being the 'hot' commodity of the year?

Thermal coal staged a remarkable rally this year, just when it was written off by investors, writes Sanlam FOUR's Adour Sarkissian.

Can this rally, which started in June 2016, continue, or is it merely a bounce from short-term oversold conditions? Coal has suddenly become pricier by more than 50% in a matter of months. However, it remains nowhere near its 2012 highs, or even its average of the past five years. So a bare reversion to mean would imply this rally has mileage. But like any basic commodity, it will eventually amount to supply versus demand. The reason for the rally appears to be a typical demand-supply imbalance.  Multi-asset managers turn to passives for commodity exposure as underweight active man...