Bloomberg News

Duet Commodities’ October Return Flat After September Drop

October 21, 2011

(Adds October Return in second paragraph.)

Oct. 21 (Bloomberg) -- Duet Commodities Fund, which manages more than $100 million, is largely unchanged in October after it had its first monthly decline of the year last month as commodities slumped the most since 2008.

London-based Duet Commodities gained 0.2 percent to date in October, Chief Investment Officer Tony Hall said today by e- mail. The fund, which trades mainly energy and metals, fell 3.8 percent in September, according to a report e-mailed to investors. That’s the third monthly drop since the fund started in July last year. It returned 28 percent this year through September.

Crude futures on the New York Mercantile Exchange fell 11 percent in September while the Standard & Poor’s GSCI Spot Index of 24 raw materials declined 12 percent, the most since November 2008, on concern a weak economic outlook in Europe and China will push the world into a recession.

“The commodities markets seem caught between the physical reality and future concerns,” Chief Investment Officer Tony Hall said in the report. “Since August markets have had to decipher between the reality of tight current physical markets, particularly in energy, and substantial concerns about the future demand driven by political and economic events in Europe,” said Hall, a former head of distillates trading at the alliance of Credit Suisse AG and Glencore International AG.

Significant Inflows

The fund had “significant inflows over the past few months,” said Hall, a former Global Head of Middle Distillate Oil Trading at Deutsche Bank AG in London. He declined to be more specific.

Investors pulled almost $10 billion out of commodity investments in September, the most since at least the beginning of 2009, Barclays Capital said today in an e-mailed report. Commodity assets under management fell to $393 million last month from $447 billion in August, the bank said.

Hedge funds are largely unregulated investment vehicles whose managers can trade any asset, aim to make money regardless of whether markets rise or fall and participate substantially in profits from money invested.

--Editors: Alessandro Vitelli, Raj Rajendran.

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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