Private natural resources

March 2024

Natural resources fall into the category of real assets, which are generally defined as long-lived physical assets valued for their intrinsic physical qualities. They are the critical inputs for energy, food, manufacturing, and construction. Natural resources are fundamentally products of the earth that have value, either in a relatively unmodified form, such as gold or diamonds, or as a key input to manufactured goods, such as iron ore into steel and cherry wood into cabinets.

In this paper, we delve into the private natural resources asset class. We outline the various sectors of natural resources, the investable market, and the factors driving returns. Additionally, we assess the historical risk and return profile of this asset class, its benefits for portfolio diversification, and its capability to hedge against inflation.