Overview

A hedge against inflation, and diversification for a portfolio.2

Commodities have shown a high correlation to inflation, but negative correlation to stocks and bonds. (January 1973-December 2015)

  • Commodities
  • Stocks
  • Bonds

Not based on the return of any specific fund.

Historical Returns (%)as of Jun 30, 2016

Annualized
1 Mo. 3 Mos. YTD 1 Yr. 3 Yrs. 5 Yrs. Life of Fund
08/31/2016
Fund at NAV -1.44 0.92 8.93 -2.31 -11.26 -10.94 -10.06
Bloomberg Commodity Index Total Return3 -1.76 -2.93 5.57 -8.76 -13.97 -12.74 -12.07
06/30/2016
Fund at NAV 4.60 9.63 12.90 -8.81 -8.67 -9.64 -9.74
Bloomberg Commodity Index Total Return3 4.13 12.78 13.25 -13.32 -10.54 -10.81 -11.23
Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) with all distributions reinvested. Returns for other classes of shares offered by the Fund are different. Performance less than or equal to one year is cumulative.

Fund Factsas of Aug 31, 2016

Institutional Class Inception 05/25/2011
Investment Objective Total return
Total Net Assets $138.4M
Minimum Investment $50000
Expense Ratio (Gross)4 0.99%
Expense Ratio (Net)4,5 0.70%
CUSIP 277923223

Portfolio Management

Thomas Seto Managed Fund since inception
Timothy W. Atwill, Ph.D., CFA Managed Fund since 2014

About Risk 

The value of commodities investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, including weather, embargoes, tariffs, or health, political, international and regulatory developments. Derivative instruments can be used to take both long and short positions, be highly volatile, result in economic leverage (which can magnify losses), and involve risks in addition to the risks of the underlying instrument on which the derivative is based, such as counterparty, correlation and liquidity risk. If a counterparty is unable to honor its commitments, the value of Fund shares may decline and/or the Fund could experience delays in the return of collateral or other assets held by the counterparty. As interest rates rise, the value of certain income investments is likely to decline. Because the Fund may invest significantly in a particular sector, the Fund share value may fluctuate more than a fund with less exposure to such sector. No Fund is a complete investment program and you may lose money investing in a Fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund prospectus for a complete description.


Performance

Historical Returns (%)as of Jun 30, 2016

Annualized
1 Mo. 3 Mos. YTD 1 Yr. 3 Yrs. 5 Yrs. Life of Fund
08/31/2016
Fund at NAV -1.44 0.92 8.93 -2.31 -11.26 -10.94 -10.06
Bloomberg Commodity Index Total Return3 -1.76 -2.93 5.57 -8.76 -13.97 -12.74 -12.07
Morningstar™ Commodities Broad Basket Category6 -1.30 -2.48 6.14 -6.89 -13.79 -12.39
06/30/2016
Fund at NAV 4.60 9.63 12.90 -8.81 -8.67 -9.64 -9.74
Bloomberg Commodity Index Total Return3 4.13 12.78 13.25 -13.32 -10.54 -10.81 -11.23
Morningstar™ Commodities Broad Basket Category6 3.50 11.71 12.61 -12.01 -10.72 -10.95
Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) with all distributions reinvested. Returns for other classes of shares offered by the Fund are different. Performance less than or equal to one year is cumulative.

Calendar Year Returns (%)

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Fund at NAV 2.30 -10.39 -14.62 -22.22
Bloomberg Commodity Index Total Return3 2.07 16.23 -35.65 18.91 16.83 -13.32 -1.06 -9.52 -17.01 -24.66

Fund Facts

Expense Ratio (Gross)4 0.99%
Expense Ratio (Net)4,5 0.70%
Institutional Class Inception 05/25/2011
Distribution Frequency Annually

Morningstar™ Ratingsas of Aug 31, 2016

Time Period Rating Rating (Load Waived) Funds in
Commodities Broad Basket
Category
Overall **** 122
3 Years **** 122
5 Years **** 80
Based on Risk-Adjusted Returns.

The Overall Morningstar Rating for a fund is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics.

© 2016 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers is responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on how a fund ranks on a Morningstar Risk-Adjusted Return measure against other funds in the same category. This measure takes into account variations in a fund's monthly performance after adjusting for sales loads (except for load-waived A shares) redemption fees, and the risk-free rate, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. Load-waived A share star ratings do not include any front-end sales load and are intended for those investors who have access to such purchase terms (e.g., plan participants of a defined contribution plan). Not all A share mutual funds for which Morningstar calculates a load-waived A share star rating may actually waive their front-end sales load. Therefore, Morningstar strongly encourages investors to contact their investment professional to determine whether they are eligible to purchase the A share without paying the front load. The Morningstar Rating may differ among share classes of a mutual fund as a result of different sales loads and/or expense structure.

NAV History

Date NAV NAV Change
Sep 28, 2016 $5.62 $0.04
Sep 27, 2016 $5.58 -$0.04
Sep 26, 2016 $5.62 $0.01
Sep 23, 2016 $5.61 -$0.05
Sep 22, 2016 $5.66 $0.05
Sep 21, 2016 $5.61 $0.03
Sep 20, 2016 $5.58 $0.04
Sep 19, 2016 $5.54 $0.03
Sep 16, 2016 $5.51 $0.02
Sep 15, 2016 $5.49 $0.01
View All

Distribution History7

Ex-Date Distribution Reinvest NAV
No records in this table indicates that there has not been a distribution greater than .0001 within the past 3 years.
Fund prospectus

Capital Gain History7

Ex-Date Short-Term Long-Term Reinvest NAV
No records in this table indicates that there has not been a capital gain greater than .0001 within the past 3 years.
Fund prospectus

About Risk 

The value of commodities investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, including weather, embargoes, tariffs, or health, political, international and regulatory developments. Derivative instruments can be used to take both long and short positions, be highly volatile, result in economic leverage (which can magnify losses), and involve risks in addition to the risks of the underlying instrument on which the derivative is based, such as counterparty, correlation and liquidity risk. If a counterparty is unable to honor its commitments, the value of Fund shares may decline and/or the Fund could experience delays in the return of collateral or other assets held by the counterparty. As interest rates rise, the value of certain income investments is likely to decline. Because the Fund may invest significantly in a particular sector, the Fund share value may fluctuate more than a fund with less exposure to such sector. No Fund is a complete investment program and you may lose money investing in a Fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund prospectus for a complete description.


Portfolio

Portfolio Statisticsas of Jun 30, 2016

Average Duration 0.42 yrs.

Commodity Exposure (%)8as of Jun 30, 2016

Agriculture 23.94
Cocoa 1.67
Coffee 3.70
Corn 3.10
Cotton 1.74
Kansas Wheat
Soybean Meal
Soybean Oil 3.41
Soybeans 3.53
Sugar 3.65
Wheat 3.15
Energy 24.97
Crude Oil-Brent 1.81
Crude Oil-WTI 1.80
Gas Oil 7.05
Heating Oil
Natural Gas 7.33
Unleaded Gas 6.99
Industrial Metals 24.77
Aluminum 7.35
Copper 7.25
Lead 1.84
New York Copper
Nickel 3.76
Tin 0.92
Zinc 3.65
Livestock 7.81
Feeder Cattle 0.88
Lean Hogs 3.45
Live Cattle 3.47
Precious Metals 18.50
Gold 7.28
Palladium 1.90
Platinum 1.81
Silver 7.52

About Risk 

The value of commodities investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, including weather, embargoes, tariffs, or health, political, international and regulatory developments. Derivative instruments can be used to take both long and short positions, be highly volatile, result in economic leverage (which can magnify losses), and involve risks in addition to the risks of the underlying instrument on which the derivative is based, such as counterparty, correlation and liquidity risk. If a counterparty is unable to honor its commitments, the value of Fund shares may decline and/or the Fund could experience delays in the return of collateral or other assets held by the counterparty. As interest rates rise, the value of certain income investments is likely to decline. Because the Fund may invest significantly in a particular sector, the Fund share value may fluctuate more than a fund with less exposure to such sector. No Fund is a complete investment program and you may lose money investing in a Fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund prospectus for a complete description.


Insights & Analysis

Commentary

A Word On The Markets as of Jun 30, 2016

The commodity markets, as measured by the Bloomberg Commodity Index Total Return (the Index)3, were up 12.78% during the second quarter of 2016. This rally in commodity prices was broad-based, with all sectors except livestock rising over the quarter.

Energy prices sharply increased over the quarter. Crude oil saw prices rise due to the production declines from reduced rig counts in the U.S., as well as supply disruptions from the Canadian wildfires and Nigerian insurgents. Natural gas prices also skyrocketed, as high temperatures across the U.S. spurred demand for gas-fired power plants to generate electricity to run air conditioning.

Grain prices were a mixed bag for the quarter, with soybean prices spiking due to drought conditions in Brazil; corn prices increasing modestly, as initial gains were tempered by reports of record plantings; and heat prices dropping on increased supplies from the U.S. due to near-perfect growing conditions.

Gold and silver prices rallied on concerns over global volatility, amplified toward the end of the quarter by the Brexit vote. Industrial metals also rose on declining supplies, as producers idled mines that could not be run economically at current prices and the Philippines threatened to close down mines that do not meet environmental standards.

Performance Summary 

Parametric Commodity Strategy Fund (the Fund) underperformed the Index during the quarter, returning 9.73% for Investor Class shares at net asset value.

  • The Fund primarily relies on three actions in pursuing its investment objectives: reweighting versus the Index, rebalancing and commodity curve positioning. When seeking commodity exposures through futures, an investor has a choice of contracts with a variety of expiration dates. That is, to seek exposure to crude oil, one can purchase a future with delivery next month, the month after that, etc., as each expiration has a distinct price. This is graphically presented as a curve (similar to the yield curve in fixed income). An index generally chooses the futures contract closest to expiration. To attempt to gain outperformance by selecting futures with expiration dates that differ from the index (i.e. to gain exposure through a different position on the curve) is referred to as curve positioning.
  • The Fund's reweighting decision had a large negative impact on relative returns during the quarter. The Fund's underweights to soybean meal and crude oil were the dominate detractors from performance, while an overweight to gasoline also hurt relative returns.
  • The Fund's emphasis on rebalancing back to target weights moderately contributed to performance, due to the presence of reversion among commodities in the Index. Reversion describes the situation where recent relative outperformers become relative underperformers, and vice versa. Rebalancing requires one to a sell a portion of the outperforming assets and is beneficial during times of reversion.
  • Curve positioning moderately detracted from Fund performance during the quarter, primarily due to curve positioning in natural gas.

Historical Returns (%)as of Jun 30, 2016

Annualized
1 Mo. 3 Mos. YTD 1 Yr. 3 Yrs. 5 Yrs. Life of Fund
Fund at NAV 4.60 9.63 12.90 -8.81 -8.67 -9.64 -9.74
Bloomberg Commodity Index Total Return3 4.13 12.78 13.25 -13.32 -10.54 -10.81 -11.23
Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) with all distributions reinvested. Returns for other classes of shares offered by the Fund are different. Performance less than or equal to one year is cumulative.

Fund Factsas of Jun 30, 2016

Institutional Class Inception 05/25/2011
Expense Ratio (Gross)4 0.99%
Expense Ratio (Net)4,5 0.70%

Contributors 

Factors contributing to the Fund's relative performance compared to the Index during the quarter:

  • An underweight to Kansas City wheat contributed to the Fund's relative performance versus the Index. Wheat prices fell on a bumper crop from the American Midwest, where perfect weather conditions have resulted in historically high crop yields.
  • An overweight to silver benefited relative performance for the quarter, as precious metals prices generally jumped on increased worries about global market volatility, including the outcome of the Brexit vote.
  • An underweight to corn was also additive to relative returns, as corn prices lagged the broader commodity universe on signs U.S. farmers had planted the third-largest corn acreage on record since 1944.

Detractors 

Factors detracting from the Fund's relative performance compared to the Index during the quarter:

  • The Fund's underweight to soybean meal was a detractor from performance versus the Index, as prices rose over 50% on severe shortages fed by bad growing conditions in several Latin American countries.
  • The Fund's underweight to WTI and Brent Crude Oil also detracted from performance, as oil rallied over the quarter on declining production levels and several large supply disruptions.
  • The Fund's choice to hold its natural gas exposure in longer-maturity contracts was also a strong detractor from returns. Natural gas saw a large increase over the quarter, which was only partially reflected in the later-dated futures held in our strategy.

Investment Outlook And Fund Positioning 

Commentators have a wide range of opinions regarding the commodity asset class. Regardless of the near-term forecast, the secular trend of increasing demand for raw materials from emerging economies is believed by many to be a permanent feature in the global economy. While commodities may continue to demonstrate remarkable volatility, they may do so against a background of increasing prices.

How does one invest in this space with so much short-term uncertainty? We seek to manage risk through broad diversification9, avoiding concentrations and rebalancing - all key factors to consider when making investment decisions. Parametric's commodity investment strategy relies on a rules-based approach, in combination with a rebalancing discipline, to avoid concentrations and is designed to seek total return.

The views expressed in this report are those of portfolio manager(s) and are current only through the date stated at the top of this page. These views are subject to change at any time based upon market or other conditions, and Eaton Vance disclaims any responsibility to update such views. These views may not be relied upon as investment advice and, because investment decisions are based on many factors, may not be relied upon as an indication of trading intent on behalf of any Eaton Vance fund. This commentary may contain statements that are not historical facts, referred to as "forward looking statements". The Fund's actual future results may differ significantly from those stated in any forward-looking statement, depending on factors such as changes in securities or financial markets or general economic conditions, the volume of sales and purchases of Fund shares, the continuation of investment advisory, administrative and service contracts, and other risks discussed from time to time in the Fund's filings with the Securities and Exchange Commission.

About Risk 

The value of commodities investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, including weather, embargoes, tariffs, or health, political, international and regulatory developments. Derivative instruments can be used to take both long and short positions, be highly volatile, result in economic leverage (which can magnify losses), and involve risks in addition to the risks of the underlying instrument on which the derivative is based, such as counterparty, correlation and liquidity risk. If a counterparty is unable to honor its commitments, the value of Fund shares may decline and/or the Fund could experience delays in the return of collateral or other assets held by the counterparty. As interest rates rise, the value of certain income investments is likely to decline. Because the Fund may invest significantly in a particular sector, the Fund share value may fluctuate more than a fund with less exposure to such sector. No Fund is a complete investment program and you may lose money investing in a Fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund prospectus for a complete description.

Attribution

No attribution information is currently available.

About Risk 

The value of commodities investments will generally be affected by overall market movements and factors specific to a particular industry or commodity, including weather, embargoes, tariffs, or health, political, international and regulatory developments. Derivative instruments can be used to take both long and short positions, be highly volatile, result in economic leverage (which can magnify losses), and involve risks in addition to the risks of the underlying instrument on which the derivative is based, such as counterparty, correlation and liquidity risk. If a counterparty is unable to honor its commitments, the value of Fund shares may decline and/or the Fund could experience delays in the return of collateral or other assets held by the counterparty. As interest rates rise, the value of certain income investments is likely to decline. Because the Fund may invest significantly in a particular sector, the Fund share value may fluctuate more than a fund with less exposure to such sector. No Fund is a complete investment program and you may lose money investing in a Fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund prospectus for a complete description.


Management

Biography
Thomas Seto

Thomas Seto

Head of Investment Management
Parametric Seattle Investment Center
Joined Parametric Portfolio Associates 1998

Thomas Seto is head of investment management for Parametric Portfolio Associates LLC, an investment adviser and majority-owned subsidiary of Eaton Vance Corp. He is responsible for all portfolio management and trading activity at Parametric's Seattle Investment Center, including tax-managed core, CPM and institutional equity strategies. He joined Parametric in 1998.

Tom began his career in the investment management industry in 1991. Before joining Parametric, he was the head of U.S. equity index investments at Barclays Global Investors.

Tom earned a B.S. in electrical engineering from the University of Washington and an MBA from the University of Chicago's Booth School of Business.

Education
  • B.S. University of Washington
  • M.B.A Booth School of Business, University of Chicago
Experience
  • Managed Fund since inception
Biography
Timothy W. Atwill, Ph.D., CFA

Timothy W. Atwill, Ph.D., CFA

Head of Investment Strategy
Parametric Seattle Investment Center
Joined Parametric Portfolio Associates 2010

Tim Atwill is head of investment strategy with Parametric Portfolio Associates LLC, an investment adviser and majority-owned subsidiary of Eaton Vance Corp. He leads Parametric's investment strategy team and is responsible for managing the continued evolution of Parametric's investment strategies and communicating these strategies to external audiences.

Before joining Parametric, Tim was affiliated with Russell Investments in its manager research unit, performing due diligence duties for the firm's consulting clients, and in its trading group, implementing derivative strategies for institutional clients. Previously, he was a non-life actuary and portfolio manager at Safeco Insurance Company.

Tim earned a B.A. in Mathematics from Reed College and a Ph.D. in mathematics from Dartmouth College. He holds the FCAS designation from the Casualty Actuarial Society and is a CFA charterholder.

Education
  • B.A. Reed College
  • Ph.D. Dartmouth College
Experience
  • Managed Fund since 2014

Literature

Literature

Fact Sheet

Download - Last updated: Jun 30, 2016

Commentary

Download - Last updated: Jun 30, 2016

Report of Organizational Actions Affecting Basis of Securities

Download - Last updated: Dec 31, 2012

Annual Report

Download - Last updated: Dec 31, 2015

Full Prospectus

Download - Last updated: May 1, 2016

Parametric Commodity Strategy Holdings

Download - Last updated: Jul 31, 2016

Holdings-1st or 3rd fiscal quarters-www.sec.gov

Download

SAI

Download - Last updated: May 1, 2016

Think Performance Think Eaton Vance

Download - Last updated: Jun 30, 2016

Semi-Annual Report

Download - Last updated: Jun 30, 2016

Summary Prospectus

Download - Last updated: May 1, 2016

XBRL

Download - Last updated: May 12, 2016