U.K. investment product provider Dawnay Day Quantum has structured its fifth commodity-linked noted, in spite of rising commodity volatility making it harder to get attractive terms for commodity deals. The five-year note, dubbed Protected Commodities Turbo, uses call options to offer investors 180% of the upside of a basket of eight commodities, including crude oil, natural gas and platinum. For every 10% the basket loses in value, however, the investor loses 1% of his capital.
Mark Mathias, ceo in London, said there is still significant investor interest in commodity-linked notes, in spite of suggestions commodity prices may be peaking. The note, which opens to investors today, is being pitched to high-net-worth and retail through advisors, and will close at the end of November. Mathias declined comment on the counterparty to the deal and on how much of the product Dawnay hopes to sell.
