Overview

The Invesco DB Commodity Index Tracking Fund aims to track the DBIQ Optimum Yield Diversified Commodity Index Excess Return (the Index). The Index is intended to reflect changes in the market value of 14 commodities that make up the index.

The Fund invests in futures contracts on those 14 commodities to track the performance of the Index. The value of the Fund’s shares is expected to fluctuate based on changes in the value of those futures contracts.

Key Financial Metrics

Metric	Q1 2024	Q1 2023
Net Asset Value Per Share	Increased 4.22%	Decreased 3.61%
Index Level	Increased 3.13%	Decreased 4.50%
Underlying Commodity Index Level	Increased 4.52%	Decreased 3.38%

Performance Details

Commodity Performance

In Q1 2024, the prices of 8 out of the 14 commodities in the Index increased, while 6 decreased. The strongest performers were:

• Brent Crude Oil: +10.65%
• RBOB Gasoline: +12.67%
  
• Gold: +7.80%

The weakest performers were:

• Natural Gas: -24.56%
• Wheat: -9.66%
• Aluminum: -2.51%

This performance was driven by an improving economic outlook, rising geopolitical tensions, and expectations of easing interest rates.

In Q1 2023, the prices of 6 out of 14 commodities increased, while 8 decreased. The strongest performers were:

• Sugar: +22.84%
• Gold: +8.23%
• Copper: +8.66%

The weakest performers were:

• Natural Gas: -42.96%
• Ultra Low Sulfur Diesel: -11.85%
• Wheat: -11.24%

This performance was largely driven by declines in energy commodities.

Fund Performance

Market Price

• Q1 2024: Increased 4.13%
• Q1 2023: Decreased 3.73%

Net Asset Value

• Q1 2024: Increased 4.22%
• Q1 2023: Decreased 3.61%

The market price closely tracks changes in the Index. Differences are mainly due to interest income earned by the Fund.

In Q1 2024, 8 rising commodity prices outweighed 6 falling prices, contributing to increases in the Index level and Fund performance.

In Q1 2023, 6 rising commodity prices were outweighed by 8 falling prices, contributing to declines in the Index level and Fund performance.

Revenue and Expenses

In Q1 2024, the Fund had:

• Total income of $22.1 million
• Net realized loss of $2.6 million
• Net unrealized gain of $52.8 million
• Total expenses of $3.4 million

In Q1 2023, the Fund had:

• Total income of $26.8 million
  
• Net realized loss of $70.3 million
• Net unrealized loss of $47.2 million
• Total expenses of $4.9 million

Strengths and Weaknesses

Strengths

• Closely tracks the performance of a diversified basket of commodity futures
• Manages exposure to each commodity based on production levels
• Employs an indexing strategy to mitigate issues like contango

Weaknesses

• Subject to volatility and fluctuations in commodity prices
• Futures trading involves leverage and can lead to large losses
• Subject to counterparty and clearinghouse credit risk
  

Outlook

The near-term outlook for commodities remains positive, supported by expectations of easing monetary policy and resilient economic growth. However, risks remain from factors like geopolitics, interest rates, and supply/demand balances.

The Fund provides an avenue for investors to gain diversified commodity exposure without needing to trade futures. Going forward, its performance will continue to track closely to the level of the Index based on the prices of underlying commodity futures contracts.