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Equities Are Not the Way to Access Commodity Markets: Fund Manager

Equities are not the way to access commodity markets, said Aaron Smith, managing director of Superfund Financial on CNBC's Protect Your Wealth, due to the risks they carry as those companies tend to be leveraged.

"You don't want to buy food, like ADM shares, to get food exposure for the same reason you don't want to buy BP to get exposure to oil."

"Investors have realized that, which has created a boom in commodity ETFs", he added.

Even though ETFs, or exchange traded funds, have been a way for investors to protect their wealth, Smith said they do not always correlate with the movements in the underlying commodities.

Caution In Precious Metals

While precious metals such as gold tend to do better in a heightened risk environment, Smith said that though he was still building positions, he would advise caution.

"I would continue to accumulate precious metals but there will be a higher sensitivity to overall economic demand worldwide, which looks to be tepid or anemic in the foregoing future," he said, adding that China would be just as affected.

Soft Commodity Uptrend to Continue

In a week where wheat prices have risen due to production cuts, one commodity that has been overlooked is coffee, Smith continued, saying it has made a "tremendous uptrend" in the past two months.

Arabica coffee prices soared this week and came within sight of the recent 12-1/2-year high.

"The long-term view is that we can see an absolute explosion in the price of most commodities...this can take several years to play out, but this will actually transcend the highs that we saw back in 2008."

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Catch "Protect Your Wealth" on CNBC's Asia Pacific network every Tuesday on "CNBC's Cash Flow," Wednesday on "Asia Squawk Box" and Thursday on "Capital Connection."