TCW and Barclays Capital raised $100 million for Everest I, the first actively managed collateralized commodity obligation. The CCO, which is a form of a collateralized debt obligation, aims to provide investors with protection against downturns in the housing and credit markets.
"We are taking an asset class with returns that are uncorrelated with interest rate risk and credit risk and turning it into a fixed-income investment," Claude Erb, TCW managing director and lead portfolio manager, said in a news release.
Several more closings are planned for Everest I, which has a weighted average rating of AA+ from Standard & Poor's. Currently, the underlying portfolio is invested in base and precious metals such as tin, lead and copper, but energy could be added if prices become more attractive, Mr. Erb said in an interview.