DoubleLine Debuts Dynamically Managed Strategic Commodity Fund

DoubleLine Debuts Dynamically Managed Strategic Commodity FundLed by the new “Bond King” Jeffrey Gundlach, DoubleLine Capital has been one of the hottest asset managers since its founding in December 2009. In addition to the firm’s institutional and sub-advisory businesses, DoubleLine also makes a number of its investment strategies available via its own line of mutual funds and closed end funds.

On August 31, DoubleLine Funds added one more fund to its roster: the DoubleLine Strategic Commodity Fund (DLCMX), a ’40 Act mutual fund managed by DoubleLine Commodity LP. Through the fund, retail investors with as little as $500 to invest via their IRAs can gain access to DoubleLine’s Strategic Commodity strategy.

The new fund’s objective is to seek long-term total return. In pursuit of this goal, the fund’s portfolio manager will employ to two distinct approaches:

  • A long-only strategic allocation to commodities and
  • A long/short tactical allocation to individual commodities.

In practice, the fund seeks returns by means of long exposures to one or more commodity indexes, and long and short exposures to individual commodities. It achieves these exposures primarily through derivatives contracts, as well as individual securities and other instruments with returns tied to commodity indexes, baskets of commodities, individual commodities, or a combination thereof.

The fund’s portfolio manager is Jeffrey Sherman. Mr. Sherman is a portfolio manager for DoubleLine LP’s derivative-based and multi-asset strategies, and he’s supported in his management of the new fund by analysts and traders in DoubleLine’s Cross Asset Team.

“The rationale for investing in commodities has several components,” said Mr. Sherman, in a recent statement. “A broad mix of commodities historically has shown low correlations to stocks, bonds and cash. So commodities can diversify a portfolio invested in traditional asset classes.”

Mr. Sherman, who will be holding a webcast on September 29 to discuss the fund and answer questions, also noted that commodities have inflation-hedging properties, and that “incremental returns potentially can be obtained by exploiting the term structure of prices of individual commodities.”

Shares of the DoubleLine Strategic Commodity Fund are available in I (DBCMX) and N (DLCMX) classes. I shares have a $100,000 minimum initial investment and a 1.11% net-expense ratio; N shares have a $2,000 minimum initial investment and a 1.36% net-expense ratio. For IRAs, the initial minimums are $5,000 and $500, respectively.

For more information, visit the fund’s web page.

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