Playing on correlation

Alternative investment products: Commodity hybrids

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Commodities have become a genuine investment alternative over the past year. Faced with falling equity implied volatilities, low interest rates and tight credit spreads, high-net-worth and retail investors have turned to the commodity markets to enhance returns. In particular, a wide variety of hybrid structures have been launched that combine commodities with other assets classes such as equity, interest rates and credit.

Much of the interest has been driven by high oil prices. With the West