Is the boom in global food prices over? I ask not just because wheat prices have fallen recently, but because Barings plans to launch a global agriculture fund.
This is a classic sign of a market peak. For example, after research in the early 1980s showed that small stocks out-performed larger ones, a host of small cap funds were created. Since then, the small cap premium has disappeared. And in the late 90s, lots of tech funds were launched.
This raises an important problem with financial innovation - the private costs and benefits of it can differ from the social costs.
From the point of view of individual fund management companies, the easiest new products to sell are those that exploit mug punters' desire to get onto a bandwagon. Hence Barings' decision, even though there are already ways to trade agricultural commodities.
However, the financial innovation that would be really useful to society would consist in offering us ways to insure against big macroeconomic risks, such as deep recession or decline in particular industries or occupations. But the private cost of developing these, allied to the fact that those who would gain most from holding them are not wealthy, mean they go uncreated. In finance - as in the economy generally - innovation is poorly rewarded.
There's a precedent here. It took John Bogle 23 years between spotting that index trackers were a good idea and actually launching the first one. Which shows that the lags between identifying a genuine benefit and creating the financial product that'll serve it can be very long.