Barclays launches managed CCO

Barclays Capital has launched Everest I, a managed version of the collateralised commodity obligation (CCO) structure it has helped pioneer.

Barclays launched its original CCO in December 2004, offering debt-like payouts from a basket of commodity trigger swaps. Underlyings included energy and precious and non-precious metals.

The new product will be managed by TCW Asset Management, a Los Angeles-based collateralised debt obligation (CDO) specialist. TCW will be responsible for selecting and managing the portfolio.

Barclays sold $100 million of the product before the first closing on 5 June."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," said Claude Erb a managing director at TCW. "For fixed income investors concerned about the future of the credit and housing markets, this is an appealing diversifier."