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THREADNEEDLE (LUX)-ENHANCED COMMODITIES AGH GBP

Bestinvest LogoA commodity fund where returns are generated from changes in the underlying commodity prices solely, rather than natural resource companies.

PRICE (INC)

-

PRICE (ACC)

1147.12p

INITIAL CHARGE

0%

ANNUAL MANAGEMENT CHARGE

1.75%

ONGOING CHARGE

2.27%

YIELD

0%

1 YEAR
-
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Prices as at 30 Nov 2023.

We don’t currently provide commentary on this fund.

Past performance is not an indication of future performance.

Capital at risk.

The fund seeks to achieve capital appreciation which is directly and indirectly linked to commodity markets. The Portfolio is actively managed and will invest in financial derivative instruments (including total return swaps) whose underlying instruments are diversified commodity indices composed of futures contracts on physical commodities. To create under and overweight positions relative to the reference portfolio in individual commodities and commodity sectors, it is intended to use a combination of long and short positions in diversified commodity indices. The long and short positions will largely offset one another and provide the SubAdvisor the ability to adjust weights and position on the curve consistent with the Portfolio’s investment strategy. The long and short positions will result in creating leverage on a Sum of Notionals basis, but on a net basis the Portfolio will continue to be fully invested in commodities and will not be leveraged to the market.

Fund summary

SectorSpecialist
StructureOFFSHORE FUND
LaunchedJune 2010
Size£208m
Yield0%
Dividends paidAccumulation units only

Charges

Standard Initial Charge0%
Initial Charge Via BestInvest0%
Additional Bid/Offer Spread0%
Annual Management Charge1.75%
Ongoing Charges Figure2.27%

Investment Process

Because the fund qualifies as a UCITs product the managers cannot invest directly in the futures curve. Instead they use swap contracts which are traded daily at the market close to avoid slippage and settle fortnightly to reduce counterparty risk. Currently they have two counterparties, Goldman Sachs and JPM. The swaps traded are excess return swaps and the arrangements with these banks are such that the managers have flexibility to effectively invest along the futures curve. This allows them to generate positive returns through changes in the structure of the yield curve. Over the long term this should contribute about one-third of returns to the fund. The structure of the yield curve is one factor driving returns. The others are fundamental views on each commodity, seasonality and technical factors. The fund can invest across all 22 different commodities in the index, plus 6 more which encompasses Metals, Energy, Agriculture and Softs. The Bloomberg index has a much lower weight to energy than the S&P GSCI index, which means it is normally less volatile. The fund is long only and ungeared.

The information on this website is not intended to be advice or a recommendation to buy, sell or hold any investment mentioned. The value of investments and the income from them can go down as well as up and you may not get back the amount invested.

Past performance is not a guide to future performance. View full risk warning