Eaton Vance Management has launched the Eaton Vance Commodity Strategy Fund, which seeks total return primarily through exposure to commodities-related investments backed by long and short positions in fixed income securities.
The fund uses a strategy that seeks broad-based commodity exposure and incremental alpha sourced primarily from three active strategies.
The fund initially seeks to generate returns comparable to the Dow Jones-UBS Commodity Index Total Return with moderate volatility around the Index.
Initially, the fund’s alpha versus the benchmark index is expected to come primarily from commodity-linked derivative instruments, global inflation-linked bonds, and emerging markets bonds.
Eaton Vance Management is the investment adviser for the fund and Armored Wolf has been engaged as investment sub-adviser.
John B. Brynjolfsson (pictured), chief investment officer and a managing director of Armored Wolf, co-manages the fund. Brynjolfsson spent 19 years of his career at Pimco, where he helped launch and grow the firm’s real return platform while serving as a portfolio manager for several of the firm’s mutual funds.
"John and his team at Armored Wolf bring extensive expertise in managing commodities-related investments to the management of the Eaton Vance Commodity Strategy Fund," says Payson Swaffield, chief income investment officer at Eaton Vance.
"Record US borrowing has driven fears that higher inflation could return. We believe that by investing in a fund which is designed to provide broad-based exposure to commodities, investors may be able to protect their purchasing power during a period of higher inflation. Additionally, while commodities on their own can be volatile investments, adding commodities exposure to a diversified portfolio may help investors reduce the overall volatility of their portfolios while improving return potential."
The fund will be co-managed by Brynjolfsson and Paul Dickson, a managing director and emerging markets fixed income portfolio manager for Armored Wolf.
The fund offers three classes of shares for purchase: class A, class C and class I.