(Bloomberg) -- As investors pull billions out of commodities, Yale University Professor K. Geert Rouwenhorst’s funds are still attracting new money.

SummerHaven Investment Management oversaw $1.5 billion as of November, from $600 million in January, said Kurt Nelson, a partner and co-founder with Rouwenhorst. That’s even as raw-material prices fell and its exchange-traded fund declined.

Commodities slumped in 2014, led by Brent crude’s collapse, on speculation that supplies of everything from energy to grains exceeded demand amid slowing growth in China. As SummerHaven’s assets more than doubled, the total amount tracking commodity products globally contracted 9.8% to $286 billion in the 10 months to October, the lowest level since 2010, according to Barclays. Investors liked SummerHaven because it lost less than others, Nelson said.

“Many long-term, strategic investors in commodities seem to like the fact that commodities are now cheaper and are topping up,” Nelson said by phone from Stamford, Conn., on Dec. 18. “There are persistent allocators to commodities as an asset class, just like investors in equities.”

While SummerHaven’s United States Commodity Index Fund fell this year and last, it still ranked first for year-to-date net asset growth and for its three-year return among U.S. broad- based commodity ETFs, Morningstar Inc. data show.

It also runs the SummerHaven Commodity Fund and SummerHaven Commodity Absolute Return Fund, said Peter Laurelli, vice president at Atlanta-based eVestment, to which SummerHaven reports its funds. Nelson declined to comment on the company’s private business, which attracted about two-thirds of this year’s new money, citing U.S. regulations.

COMMODITIES TUMBLE

The Bloomberg Commodity Index fell to a five-year low this month and is headed for a fourth annual decline in the longest run of losses since at least 1991. The MSCI World Index of global stocks rose 2.8%, while the Bloomberg Dollar Spot Index gained 11% on prospects for higher U.S. interest rates next year as the world’s largest economy recovers.

Assets in the United States Commodity Index Fund, which is co-owned and sponsored by United States Commodity Funds LLC, grew 61% to $820 million at the end of November, Nelson said. The ETF, which can bet only on price gains, lost 4.9% in the past three years on an annualized basis, the least among 20 similar products tracked by Morningstar, according to Senior Research Analyst Michelle Swartzentruber. Since its inception in August 2010, the ETF returned 5.8% through last month.

“There are two reasons that we attracted money,” Nelson said. “One is that, relative to our peers, we have greater performance. Secondly, while commodities have gone down, they are still diversifying assets in your portfolio.”

FACTS, FANTASIES

Rouwenhorst, finance professor at Yale’s School of Management, and his colleague, Gary Garton, published a paper “Facts and Fantasies About Commodity Futures” that argued that an investment in a broad commodity index would have brought positive returns from 1959 to 2004. Subsequent research recommended investing in raw materials with low inventories.

These works underpin SummerHaven’s strategy, said Nelson. Each month, the SummerHaven Dynamic Commodity Index, the gauge that’s tracked by the United States Commodity Index Fund, selects 14 among 27 raw materials based on an assessment of low supplies and price performance. Ashraf Rizvi, a co-founder of SummerHaven and former global commodities head at UBS Group AG, oversees trading at the company.

“This is a very challenging time for commodities,” said Nelson, who helped UBS manage its U.S. commodity index business before SummerHaven was set up in 2009. “We have done well, which we are very glad about in terms of raising money, but it has been a challenging period.”

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