10-Q: Amplify Commodity Trust Reports Strong Q3 2026 Performance

Amplify Commodity Trust's Q3 2026 report shows significant gains for its Breakwave Tanker Shipping ETF (BWET) and solid performance for its Dry Bulk Shipping ETF (BDRY), driven by market conditions and geopolitical factors.

Summary

• The Amplify Commodity Trust, comprising the Breakwave Dry Bulk Shipping ETF (BDRY) and Breakwave Tanker Shipping ETF (BWET), reported its financial results for the quarter ended September 30, 2026.
• BDRY experienced a 22.58% increase in market value per share and a 21.26% increase in Net Asset Value (NAV) per share during the quarter.
• BWET saw a substantial increase of 441.22% in market value per share and 422.85% in NAV per share during the same period.
• Both ETFs benefited from gains in futures contracts, contributing to significant net income for the period.
• The Trust operates as a series trust with two distinct ETFs, BDRY and BWET, managed by Amplify Investments LLC.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, driven by strong performance in the tanker shipping ETF (BWET) due to geopolitical events, while the dry bulk ETF (BDRY) also showed solid gains. The overall financial health appears robust, with significant unrealized gains.

Positives

• BWET demonstrated exceptional performance with a 441.22% increase in market value per share and a 422.85% increase in NAV per share for the quarter ended September 30, 2026, largely due to geopolitical events impacting tanker rates.
• BDRY also showed strong performance, with a 22.58% increase in market value per share and a 21.26% increase in NAV per share.
• Significant net realized gains on futures contracts were reported for both ETFs: $107,357,456 for BWET and $6,105,789 for BDRY.
• BWET reported substantial unrealized gains on futures contracts of $40,120,382.
• The combined net income for the quarter was $152,093,692.

Negatives

• Both BDRY and BWET reported net investment losses of ($531,547) and ($158,439) respectively for the three months ended September 30, 2026.
• BWET's NAV per share calculation was impacted by a net investment loss of ($531,547).

Risks

• The NAV of each Fund's shares is directly tied to the value of its freight futures portfolio, cash, and cash equivalents, making them susceptible to material adverse effects from price fluctuations.
• Charter rates for dry bulk vessels and crude oil tankers are highly volatile and may decrease rapidly or remain at low levels.
• Futures and options contracts have expiration dates, and the need to enter into replacement contracts at potentially less favorable terms (negative roll risk) can lead to losses.
• Geopolitical events, such as conflicts in the Middle East and Ukraine, and trade policy changes (tariffs) can significantly impact global economic growth, trade volumes, and consequently, shipping rates and freight futures prices.
• The resolution of the current conflict in the Middle East is a primary determinant of future tanker rates, with a high risk of significant and rapid correction in spot rates.
• The crude tanker orderbook is above historical averages, indicating potential future increases in fleet supply that could pressure rates.
• Liquidity risk exists if the Funds cannot dispose of holdings quickly or at desired prices due to market disruptions or low trading volumes.
• Natural disasters, epidemics, and pandemics can disrupt economies and markets, exacerbating other risks and impacting the Funds' ability to achieve objectives.

Future Outlook

The report does not contain specific forward-looking guidance. However, it highlights that the progression of the current military conflict in the Middle East will be the primary determinant of tanker rates in the near term, with a high risk of significant and rapid correction. Similarly, trade policies and geopolitical uncertainties pose risks to shipping rates. The crude tanker orderbook and dry bulk orderbook are noted as factors that could influence future supply and rates.

Management Comments

• The Sponsor has exclusive management and control of all aspects of the Trusts business, with the Trustee having no duty or liability to supervise the Sponsor.
• The Sponsor is responsible for establishing and maintaining disclosure controls and procedures and internal control over financial reporting.
• Management has evaluated the effectiveness of disclosure controls and procedures and found them to be effective.
• The Sponsor has evaluated the impact of adopting new accounting guidance and determined there is no impact for the Funds.

Industry Context

StockSavvy.ai notes that the performance of both ETFs is heavily influenced by global shipping dynamics. The significant gains in BWET are directly attributable to geopolitical disruptions in the Middle East impacting tanker rates, while BDRY benefits from strong dry bulk demand and fleet inefficiencies. The report underscores the inherent volatility and sensitivity of these sectors to global events.

Comparison to Industry Standards

• BDRY is the only dry bulk freight futures ETF globally.
• BWET is the only tanker freight futures ETF globally.
• The report does not provide direct comparisons to other industry benchmarks beyond the internal benchmark portfolios for each ETF.

Legal Proceedings

• The Funds are currently not a party to any pending legal proceedings.

Related Party Transactions

• Amplify Investments LLC (Sponsor) receives management fees from both BDRY and BWET.
• Breakwave Advisors, LLC (CTA) receives license and service fees from both BDRY and BWET.
• Amplify Investments LLC (Sponsor) assumes certain expenses for BDRY and BWET under expense caps.
• U.S. Bank provides administrative, accounting, and custody services for a fee.
• Foreside Fund Services, LLC provides marketing services for a fee.
• Amplify Investments LLC (Sponsor) receives wholesale support fees from BDRY and BWET.

Stakeholder Impact

• Shareholders of BDRY and BWET have benefited from significant gains in the market value and NAV per share during the quarter.
• The performance of the ETFs is directly linked to the volatile freight futures market, posing risks to shareholder investments.
• The management fees and other expenses paid to service providers impact the net returns for shareholders.

Next Steps

• The Funds will continue to track their respective benchmark portfolios consisting of futures contracts.
• The BDRY Benchmark Portfolio will progressively increase its position to the next calendar quarter three-month strip.
• The BWET Benchmark Portfolio will progressively increase its position to the next calendar quarter three-month strip.
• The Sponsor will continue to manage the Trust and its Funds.
• The Funds will continue to hold cash or cash equivalents for liquidity and margin requirements.

Key Dates

Recommendation

While both ETFs have shown strong recent performance, particularly BWET due to geopolitical factors, the inherent volatility of the underlying freight futures market and the potential for rapid corrections present significant risks. The strong gains are largely driven by external factors that could reverse quickly. Therefore, a 'hold' recommendation is prudent, allowing investors to benefit from current gains while acknowledging the substantial risks and uncertainties in the shipping and commodity markets.

Keywords

shipping futures, dry bulk shipping, tanker shipping, freight futures, ETF, commodity trust, Baltic Exchange, futures contracts