The majority of asset classes found in real asset portfolios generally share similar benefits. Whether it is real estate, timber, infrastructure, commodities, or oil and gas, they all may provide low correlation and inflation/currency hedging. However, it is oil and gas that has benefits worth expounding upon.

First, let’s define what it means to own or invest in oil and gas. In order to gain the benefits above you must physically own oil and gas. Because above-ground storage of the produced product becomes practically impossible very quickly, this typically means owning reserves stored in the ground.

This is easier said than done because, like timber, the ownership of oil and gas reserves entails mastering several arcane technical disciplines, but more on that later. Let’s start with the potential portfolio benefits.

First is low correlation: The economic importance of oil and gas means that the impacts of price changes in the commodity ten