DoubleLine Capital, the investment firm overseen by Jeffrey Gundlach, on Monday opened a new mutual fund to give investors exposure to commodities markets and help them diversify.
The DoubleLine Strategic Commodity fund seeks long-term total return through long and short exposures to commodity-related investments, including through the use of derivatives and leverage.
"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," portfolio manager Jeffrey Sherman said.
"In addition, commodities can serve as a hedge against unexpected inflation. Finally, incremental returns potentially can be obtained by exploiting the term structure of prices of individual commodities."
A DoubleLine spokeman told Financial Advisor, "The overall portfolio will always be net long. Part will always be long. No more than half with be long-short."
Sherman is a portfolio manager for derivative-based and multi-asset strategies at Los Angeles-based DoubleLine, which had $76 billion in assets under management as of June 30.
The fund has two share classes. Class I shares will have a minimum $100,000 initial investment for regular accounts and a 1.11 percent expense ratio, while Class N shares will have a minimum $2,000 initial investment and a 1.36 percent ratio, after fee waivers or expense reimbursements.