Despite their volatility, natural resources remain an essential part of a diversified portfolio, both for their growth potential amid the energy transition and their inflation-hedging qualities. 

The Morningstar Global Upstream Natural Resources Index, which tracks companies tied to energy, metals, agriculture, timber, and water, shows that while commodities can be unpredictable, they tend to outperform when traditional assets falter. In 2022, for example, as stocks and bonds plunged together, the index gained more than 15% thanks to surging prices in oil, metals, and timber driven by inflation and supply disruptions. 

Recent years have favored technology-driven markets and left resource exposure underrepresented, inflationary pressures, geopolitical tensions, and the green energy shift may revive their relevance. 

Finsum: Ultimately, natural resources offer diversification and resilience, qualities that matter most when the rest of the market is under stress.