Thursday, 5 March 2015
Last updated 4 hours ago
Apr 18 2007 | 4:14pm ET
Hoping to lure institutional investors without commodity exposure into the asset class, Credit Suisse has issued US$190 million in long/short collateralized commodity obligations notes. The notes, which have received Fitch Ratings’ highest rating, are the first global long/short CCO transaction, according to CS.
“The combination of the long and short portfolio mitigates the risk to principal loss as well as mark-to-market value movements, whilst maintaining a yield substantially about most other AAA-rated instruments,” Gunnar Hoest, of CS’s fixed-income department, said. The notes, in five- and three-year tranches, were priced at a spread of 195 basis points and 180 bps over benchmark, respectively, and are available in U.S. dollar-, euro- and Australian dollar-denominations.
Buyers included banks, insurance companies and mutual funds, CS said, many of which have no experience with commodities exposure.
“It allows investors to put money in a balanced long and short basket of commodities in note form, diversifying their portfolios beyond the traditional credit and equities asset classes,” Bikran Chaudhury, also of the CS fixed-income department, said.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…